Cypherpunk Holdings Renamed SOL Strategies

Cypherpunk Holdings (ticker: HODL) is doubling down on its strategy to buy and stake Solana’s native token, leading to its renaming as SOL Strategies, announced on Thursday.

The firm, which began purchasing SOL in Q2 2024 under CEO Leah Wald, now holds over 86,000 Solana tokens valued over $11 million. Most tokens are staked for rewards.

“We’ve put more of our balance sheet into SOL and are engaging with the Solana ecosystem as much as possible,” Wald stated in an interview. “We are highly focused on the Solana ecosystem.”

SOL Strategies mirrors MicroStrategy’s approach to bitcoin accumulation, positioning its stock as a proxy for traders to gain exposure to Solana without direct token purchase.

In June, while still under the Cypherpunk name, the firm became possibly the first publicly traded company to add SOL to its balance sheet.

Wald highlighted that MicroStrategy has successfully used its treasury management strategy to let investors access bitcoin through their stock. Similarly, Cypherpunk purchased its first 100 BTC in 2019.

However, Wald noted that unlike MicroStrategy’s leverage via debt, HODL operates more like a bitcoin mining stock since most SOL tokens earn yield in in-house validators. She also pointed out the uniqueness of SOL Strategies, as no other companies operate a validator and North America currently lacks approved staked-SOL ETFs.

The SEC is expected to take time to approve a SOL ETF, limiting institutional investor options to SOL Strategies stock for exposure to Solana. This echoes MicroStrategy’s experience in 2020 when no U.S. bitcoin ETFs existed.

SOL Strategies acquired SOL tokens at an average price of $143 and earned 230.35 SOL (~$57,000) from staking by June.

Rising Interest in Solana

Amid increasing Solana interest, driven by transactions from the memecoin launchpad Pump.fun, Wald views memecoins as potentially fleeting but anticipates lasting interest in Solana’s utility.

Wald believes Solana’s high throughput and low fees will be advantageous for businesses in the financial sector. She expresses concern regarding Bitcoin and Ethereum’s transaction management.

While increasing focus is on Solana, SOL Strategies continues its multi-token strategy, retaining bitcoin as a treasury asset. The firm has recently sold about 109 BTC and exited its investment in Animoca Brands. Currently, SOL Strategies reports approximately $4.9 million in cash and $115,000 in liabilities.

When questioned about potential SEC-approved Solana ETFs undermining SOL Strategies, Wald was optimistic, stating that a rising tide would benefit all.