Solana Co stock tumbles after resale registration decision

Investing.com -- Solana Company (NASDAQ:HSDT) stock plunged 20.8% on Monday after the company announced its decision to proceed with a scheduled registration for resale of shares from a recent private placement despite market volatility.

In a letter to shareholders, Executive Chairman Joseph Chee characterized the move as a "deliberate choice" that would establish "a foundation of committed long-term shareholders" despite potentially causing near-term pressure on the stock price. The company positioned the decision as a transparency measure, contrasting its approach with competitors who have postponed similar registrations.

Chee acknowledged that the registration effectiveness would likely "shake out weak hands" but defended the timing as appropriate for reaching "market equilibrium" rather than delaying the inevitable. He noted that if shares trade below net asset value, investors would effectively be able to purchase Solana cryptocurrency at a discount.

The company, which describes itself as a digital asset treasury focused on Solana, outlined its strategy to generate yields through institutional-grade staking and strategic capital deployment during market dislocations. Management compared its long-term vision to building "the Berkshire Hathaway of the Solana ecosystem."

HSDT emphasized its ability to accumulate more SOL per share than individual investors could achieve independently, targeting 7%+ yields through sophisticated staking operations not typically accessible to retail investors.

The significant stock decline suggests investors remain skeptical about the timing of the registration decision, despite management’s attempt to frame it as beneficial for long-term shareholders.

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