Sonnet BioTherapeutics Enters Crypto Space with $888 Million HYPE Token Treasury

Sonnet BioTherapeutics, a Nasdaq-listed biotech firm, has announced a significant strategic shift by entering the digital asset space. The company has revealed plans to launch an $888 million Hyperliquid (HYPE) token treasury under a newly formed entity, Hyperliquid Strategies Inc. (HSI). This move involves a business combination with Rorschach, a company recently created by Sonnet, to spearhead its new crypto-focused strategy.

Under this transformation, Sonnet will acquire 12.6 million HYPE tokens, valued at approximately $583 million at the time of the agreement. Additionally, the company will hold $305 million in cash reserves, bringing the total value of the entity to $888 million. HSI also plans to use part of its cash reserves to purchase additional HYPE tokens in the future. Hyperliquid, the token central to this pivot, powers a high-throughput layer-1 blockchain designed for onchain trading of perpetual futures and other advanced financial instruments. It currently ranks as the 12th-largest token globally, with a market capitalization of $16.2 billion.

By creating HSI, Sonnet offers traditional equity investors indirect exposure to HYPE, bridging the gap between conventional finance and emerging blockchain technologies. This strategy is reminiscent of Strategy, a business intelligence firm that pivoted into Bitcoin investments, providing stock market investors with exposure to crypto without direct token purchases. The initiative is supported by prominent institutional investors, including Atlas Merchant Capital, Paradigm, Galaxy Digital, Pantera Capital, D1 Capital, Republic Digital, and 683 Capital. Paradigm co-founder Matt Huang described Hyperliquid as a crypto project with robust fundamentals, noting the growing institutional appetite for HYPE exposure despite its limited accessibility in the U.S.

Similarly, Eyenovia, Inc., a Nasdaq-listed ophthalmic technology company, announced a significant $50 million investment in Hyperliquid’s native cryptocurrency, HYPE. While Sonnet undergoes this significant transformation, it will continue operating its clinical oncology portfolio under HSI’s corporate umbrella. This move not only enhances Sonnet's treasury strategy but also sets a precedent for other biotech firms considering a similar shift into the cryptocurrency sector. The backing of heavyweight institutional investors further validates the potential of this new venture, suggesting that other companies may follow suit in the coming years.