DeFi Development Corp (formerly Janover) Aims to Raise Over $1B to Invest in Solana

By: Belinda Wan Updated Apr 27, 2021 at 1:13 a.m. PDT

DeFi Development Corp (formerly Janover) (NASDAQ:JAV) is planning to raise over $1 billion to invest in Solana (CRYPTO: SOL), Capital Markets announced.

What Happened: The Nasdaq-listed firm, previously a real estate financing platform connecting commercial property lenders and buyers, announced its plans in a Form S-3 registration statement filed with the U.S. Securities and Exchange Commission (SEC) on April 25.

The filing states that the funds will be used for general corporate purposes, including Solana Standard units for Acquisition, or SOL token acquisitions.

According to the filing, the company may use proceeds from the offering to purchase more Solana, noting: "A portion of the net proceeds from this offering may be used to fund the acquisition of Standard units for Acquisition, which are units of a trust that will hold and pay interest on a principal amount of a single tranche of a Series A Preferred Stock issued by DeFi Development Corp.,”

The company also warned that fluctuations in Solana’s price could lead to it converting the tokens into cash at a value "substantially below" the net proceeds raised.

Janover was a real estate financing company connecting lenders and buyers of commercial properties before a team of former Kraken (CRYPTO: PIXEL) exchange executives bought 728,632 shares of its common stock on April 7. Joseph Onorati, former chief strategy officer at Kraken, has since been appointed as chairman and CEO.

The announcement comes shortly after the leadership of DeFi Development Corp adopted a Solana treasury reserve, “by applying a proven public-market treasury model to an asset that’s earlier in its lifecycle, structurally reflexive, and vastly underexposed as compared to Bitcoins.”

The firm’s new Solana investment treasury has drawn comparisons to Michael Saylor’s Strategy, which has amassed over 538,200 Bitcoin (CRYPTO: BTC) as of April 20 — the world’s largest corporate Bitcoin holder.

The firm’s board of directors approved the company’s Solana-focused treasury policy on April 4, authorizing long-term accumulation and the launch of Solana validators to enable the staking of its treasury asset.

Parker White, the firm’s chief investment officer, who previously served as an engineering director at Kraken exchange, already runs a Solana validator with $75 million in delegated stake.

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Regulatory Concerns Remain For Solana Investment: While the Solana-focused treasury implementation marks a significant step for altcoin adoption, the firm remains concerned by the potential effects of opaque crypto regulations, according to the filing:

The firm cites unclear regulations around digital assets, which may “adversely affect the price of Solana” and, in turn, impact “the market price of our common stock.”

The firm noted that Solana’s potential “reclassifying” as a security remains a particular concern, which may lead to the firm being classified as an investment company under the Investment Company Act of 1940.

However, the firm’s share price has been benefitting from its Solana acquisitions. Its shares rose by over 12% when DeFi Development Corp added $11.5 million worth of Solana tokens to its treasury on April 22, reported.

“The decision by commercial property platform Janover to add SOL to its treasury is truly groundbreaking,” said Chris Chung, founder of Solana-based swap platform Titan. “I’m confident we will see many other businesses follow suit before long as crypto becomes increasingly adopted by traditional finance.”