The shareholders of Sonnet BioTherapeutics have given the green light for a significant merger aimed at establishing a new fund, the Hyperliquid Strategies, which is set to operate as a Digital Asset Trust (DAT) with a target capitalization of $1 billion. This pivotal agreement, which was initially revealed several months ago, has now moved forward following operational delays, solidifying the company”s intent to make a substantial entry into the cryptocurrency space.
In July, Sonnet formalized a partnership with Rorschach I LLC, a newly formed entity linked to investors experienced in the Hyperliquid ecosystem. This strategic initiative was positioned as a crucial step toward structuring a public DAT capable of holding a significant amount of the HYPE token, alongside financial resources that have been in the pipeline since the initial announcement.
At the onset, expectations indicated that the DAT would assemble approximately 12.6 million HYPE tokens and around $305 million in cash, leading to an estimated valuation of $888 million. The project took another significant step in October when Hyperliquid Strategies filed an S-1 form with the SEC, signaling its intention to raise up to $1 billion through an initial public offering.
Despite the overwhelming support from shareholders, David Schamis, CEO of Hyperliquid Strategies, reported challenges in finalizing the voting process. “While over 95% of the votes received so far have been favorable, we have yet to reach the total number of votes needed to complete the voting,” he stated regarding the delays.
Notably, Hyperliquid has gained recognition for its decentralized exchange specializing in perpetual futures, having recorded more than $1.5 trillion in trading volume since the beginning of 2023. The increasing interest in DATs comes amid a tough market environment, characterized by declines in the prices of leading cryptocurrencies. To counteract these pressures, numerous firms have initiated stock buyback programs to stabilize their operational frameworks.
Sonnet”s actions align with a broader trend among companies seeking to explore new avenues for tokenization and digital asset management. For instance, in June, Lion Group Holding secured $600 million to launch its own Hyperliquid DAT structure. In the meantime, the HYPE token, which was valued at approximately $47 at the time of the merger announcement, has since been trading around $33.
Among the strategic investors participating in this initiative are notable names such as Galaxy Digital, Pantera Capital, D1 Capital, Republic Digital, and 683 Capital, underscoring the growing institutional interest in funds backed by crypto assets.
