Upexi, a Solana treasury-focused firm, saw its stock collapse by over 60% on June 24, 2025. The drop followed the filing of a prospectus that allowed existing shareholders to sell up to 43.85 million shares and warrants. The filing was submitted to the SEC on June 23 and made effective shortly before trading began on June 24. According to the prospectus, none of the proceeds from these sales would go to Upexi itself. Instead, the company registered the shares to allow investors who participated in earlier private placements to exit their positions.
In total, the filing covered 35,970,383 common “PIPE” shares and 7,889,266 shares underlying warrants. Many of these shares originated from a private placement Upexi completed in April, in which it raised over $100 million. The company utilized the capital to acquire SOL tokens and reduce debt.
The market reaction was severe. Upexi’s stock dropped from above $9 to below $4, despite no material change in the price of $SOL itself. This suggests that the selloff was driven primarily by the surge in newly unlocked supply and the potential for further dilution.
Upexi announced the move on social media on Tuesday, clarifying that “the registration statement becoming effective does not necessarily mean they will sell.”
Still, Upexi’s stock showed far greater volatility than $SOL. While $SOL traded within a relatively tight range throughout the week, Upexi shares saw choppy and unpredictable price movements. This highlights a key investor risk: stocks of crypto treasury companies can be more volatile than the underlying crypto assets they hold.
DeFi Dev Corp: Another Unlock, Another Drop
DeFi Development Corp., another Solana-centric treasury company, faced a similar situation. While the drop in its stock was less extreme, the market still reacted negatively after a share unlock coincided with news of a tokenized stock offering and validator partnership.
On June 23, DeFi Dev Corp. announced that it was going to launch “DFDVx,” a tokenized version of its equity on Solana through Kraken’s xStocks platform. This announcement came on the heels of a statement that the company had secured a $5 billion Equity Line of Credit (“ELOC”), designed to fund continuous $SOL purchases and support its validator infrastructure. Coincidentally, the ELOC went live on June 24. The firm also unveiled a validator collaboration with the Dogwifhat ($WIF) community, aiming to merge memecoin energy with institutional treasury backing.
Despite these moves, DFDV stock dropped 16% on June 24. This mirrored Upexi’s experience, where positive strategic news failed to offset investor fear over dilution and large exits.
Unconventional Strategies
Like Upexi, DeFi Dev Corp. shifted its business to a Solana treasury model, but it took an even more aggressive approach to funding it. On June 12, 2025, the company announced a new $5 billion Equity Line of Credit (“ELOC”), granting it the right to issue up to $5 billion in shares to raise capital for Solana purchases. This means DeFi Dev Corp. can effectively tap a vast pool of financing on demand.
In effect, DeFi Dev Corp. is loading up on $SOL by promising shareholders potential dilution if it needs capital. Instead of selling shares gradually to the market, they sell directly to RK Capital through the ELOC, who then sell to the market. In exchange for providing this liquidity bridge, RK earns $12.5 million upfront as a commitment fee, along with a discount of 1.25% to 2.00% on all shares purchased under the agreement.
Daily share sales under this ELOC are capped at the lesser of 500,000 shares or 20% of the average 20-day trading volume. Given DFDV’s approximately $20 share price and a 20-day average volume of around 2.1 million shares, this translates to roughly 420,000 shares, or approximately $8 million in potential daily capital inflow.
DeFi Dev Corp’s case highlights the double-edged sword of its strategy. The new equity line provides flexibility. Management says it can raise money gradually when convenient, rather than timing a single large stock sale. But it also means a cloud of future dilution hangs over the shares. The company’s SEC filings explicitly warn that a falling $SOL price could wipe out gains and that “the price of our common stock has been and may continue to be volatile and fluctuate substantially.”
However, the ultimate success of this strategy will hinge on how the market absorbs future share issuances and whether Solana’s fundamentals can justify the premium investors are currently paying.
The Risks of “Infinite” Funding
In practical terms, if $SOL enters a bear market, treasury companies that heavily fund $SOL accumulation might suffer significant losses on their holdings while still incurring the costs (and dilution) of the capital they raised. SEC filings already emphasize these dangers: both Upexi and DeFi Dev mention that SOL price drops and subsequent stock volatility could hurt investors. In a bear scenario, the strategy of continually selling shares to buy crypto may not play out because every share issuance burdens existing shareholders (further pressuring the stock).
At the time of the ELOC activation, $DFDV was trading at a +5x premium to its net asset value (NAV). This premium reflected investor enthusiasm around its Solana strategy, its aggressive accumulation, and forward-looking bets on a potential Solana spot ETF approval. Similar premiums were present across other Solana-aligned stocks, such as Upexi’s, suggesting that investors were pricing in not just current SOL holdings but also expected future inflows and institutional adoption of Solana.
However, this setup made the stocks particularly vulnerable to correction. Although SOL has remained relatively stable and is still trading near the average buy price of many of these treasury firms, their stock prices had run far ahead of book value. The recent selloffs, including DFDV’s 16% decline and Upexi’s 60% crash, likely represent a market recalibration, aligning valuations more closely with underlying NAV.
In summary, both Upexi and DeFi Development Corp saw sharp stock declines when massive blocks of their shares became sellable. These events underscore that turning a balance sheet into a perpetual Solana mint is no guaranteed win. While volatility can theoretically be an asset (by harvesting swings), real-world market pressures and bear markets pose clear risks.
Read More on SolanaFloor
Gemini Named $SOL Staking Custodian for DeFiDevCorp, Purpose Investments ETF
Is It Stablecoin Summer Yet?
