Key Points
- Forward Industries increased the amount of SOL in its treasury to 8.73 million coins.
- The company received $50 million in financing supported by the pledge of SOL.
- Solana Weakening prices trigger new concerns about collateral
Forward Industries (Nasdaq ticker: FWDI) has increased its Solana treasury to approximately 8.73 million SOL, and despite the token approaching the psychologically significant level of $80, the company continues to expand its exposure to crypto assets.
According to the disclosure document submitted by the company to the U.S. Securities and Exchange Commission (SEC) on November 10, Forward added 226,396 units of SOL and SOL equivalent assets between September 30 and November 9, increasing its total holdings from 8.5 million to 8.73 million units.
Forward Industries holds nearly 1.5% of the circulating supply of Solana.
Forward Industries currently holds approximately 1.5% of the Solana circulating supply, making it one of the largest listed holders of this cryptocurrency.
The average cost of reporting newly added tokens is $75 per token, but this figure includes pledge rewards that are counted in but do not have a cash acquisition cost.
Since its first large-scale purchase, despite significant fluctuations, Forward has continued to advance its SOL accumulation strategy.
$50 million credit line to increase leverage for the SOL strategy
While updating its treasury situation, Forward also announced the acquisition of a two-year credit line worth 50 million US dollars, with the SOL held in its treasury serving as collateral for this line.
The lender, whose name has not been disclosed, is a federally licensed national bank that is insured by FDIC. The interest rate for this financing is SOFR plus 150 basis points.
Importantly, the pledged SOL can continue to maintain its pledged status and generate network rewards, and the lender is not allowed to re-pledge it.
However, borrowing using cryptocurrencies carries additional risks when the value of the collateral drops significantly.
Forward had previously accumulated millions of SOL at significantly higher prices and subsequently faced considerable unrealized treasury losses.
The company's most recently disclosed net asset value also decreased from approximately $870.4 million on September 30 to $600.3 million on November 9, despite an increase in the number of token holdings.
During the same period, the institutional debt balance increased from $167.5 million to $187.5 million.
These data highlight the challenges faced by Solana treasury companies when the decline in coin prices offsets additional increases in holdings.
Solana approaches $80, Forward expands its tokenized housing strategy
Forward also commits to investing up to $50 million in USHP in order to diversify its treasury strategy. USHP is a tokenized investment product that tracks the prices of residential real estate in the United States.
The company expects that the potential revenue in US dollars generated from this investment can be used to support further increases in holdings of SOL.
In addition, Forward has also added Barclays to the existing plan for issuing shares at market price, as a sales agent that operates in parallel with Cantor Fitzgerald.
As SOL approaches the $80 level that was pointed out during the market correction in October, this expansion measure has been introduced.
If prices continue to fall, it may put even greater pressure on the collateral positions and balance sheets of Forward, although the company has not disclosed any immediate notices for additional margin payments.
Previously, large transfers of SOL also attracted attention, as the market feared that the treasury might sell off its holdings.
Emir Abyazov
Coinpaper serves as the editor-in-chief, responsible for driving data-driven editorial operations, SEO导向的内容 discovery, and storytelling tailored to the audience, covering the fields of cryptocurrencies, AI, and fintech.
