The stock of Solana Company (HSDT), a SOL treasury firm, increased 17% on Friday after it launched a new lending model for institutions. This on-chain lending model allows institutional lenders to borrow against their staked Solana (SOL) holdings without selling the tokens, according to an official statement.
However, these tokens must be held in a regulated custodial service, such as Anchorage Digital, as collateral for loans while continuing to earn staking rewards.
Corporate Crypto Balance Sheets Under Pressure
This announcement comes as the SOL price has fallen significantly since it reached nearly $245 in 2024. Thus, this puts additional pressure on the crypto balance sheet of corporations holding this digital asset. As a result, there is an increase in corporate adoption of yield-focused treasury management strategies.
Solana Company’s shares have rebounded to approximately $2.21 per share after reaching an all-time low of just under $1.80 per share earlier this week, per data from TradingView. This happens as investors appear to be looking for ways to create capital-efficient liquidity models.
Source: TradingView
Solana Company is the second largest publicly-traded holder of SOL, holding nearly 2.3 million SOL tokens, worth approximately $200 million. The significant drop in SOL price since late March has put downward pressure on the valuation of treasuries holding this token. This has pushed them to look beyond holding models focused solely on price appreciation.
Increasingly, publicly-traded crypto treasury firms are utilizing staking income, validator services, and collateral-based on-chain credit to replace speculative token exposure. Thus, they can have more stable sources of revenue and improved cash flows.
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Yield Generation Becoming A Key Revenue Stream
Other Solana treasury companies are starting to pivot toward generating yield. For instance, SOL Strategies launched a liquid staking token backed by over 500,000 SOL and a fee-generating product in addition to its validator business.
Sharps Technology stated that it earned a 7% annualized yield from staking its SOL while also building its validator infrastructure. Also, Upexi stated that staking income accounts for more than half of its revenue even though the company posted a $179 million quarterly loss.
This was primarily due to accounting revaluations resulting from decreased token prices. The trend demonstrates how staking rewards are becoming a primary source of cash flow for institutional crypto treasuries.
Borrowing Using Staked SOL Tokens Similar to Securities-Based Loans
With this product, institutional lenders that are borrowing using staked SOL tokens may be able to avoid having to unstake. Also, they will not need to exit their long-term SOL positions during periods of downward pressure on the market.
Instead, they will still retain some level of exposure to any upside in the token’s price. Utilizing regulated custody in conjunction with DeFi lending infrastructure will enable corporate crypto treasuries to overcome regulatory hurdles. These are obstacles faced by publicly-traded companies seeking on-chain liquidity.
Why This Is Important
Corporate crypto treasuries have begun shifting away from speculative token exposure toward structured yield and credit models.
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