Why Did Solana and Ethereum Treasury Stocks Plunge on Routine SEC Filings?
Crypto treasury companies are experiencing significant stock price declines after raising funds through private investments in public equity (PIPE). SharpLink Gaming and Upexi saw their stock prices drop over 60% following effective registration-of-shares filings by the SEC. PIPE investors, who cannot sell shares until the filings are effective, capitalized on rapid price increases, leading to profit-taking. SharpLink's PIPE investors experienced a 429% surge in value, prompting concerns about short-term selling behavior. The effectiveness of these filings is viewed positively for long-term liquidity and future capital raising. The volatility of stocks in this sector resembles that of cryptocurrencies with low circulating supply, affecting perceived valuations. Investors are advised to be cautious as stock prices may not accurately reflect the underlying value of crypto assets.
