Fitell, a Nasdaq-listed fitness equipment company, saw its shares plunge 21% after announcing a $10 million acquisition of Solana tokens as part of a broader $100 million digital-asset strategy.
The firm disclosed that it bought more than 46,000 SOL using proceeds from a convertible note, with 70% of net funds earmarked for digital currencies.
CEO Sam Lu described the move as a strategic shift into building a crypto treasury and staking business, aimed at generating yield and long-term shareholder value.
Fitell also appointed advisers David Swaney and Cailen Sullivan to guide its treasury management, focusing on yield optimization and DeFi risk assessment.
However, investors reacted negatively, with shares closing at $6.65 on Wednesday and slipping slightly in after-hours trading. Analysts note that other small-cap firms pursuing similar treasury strategies, including Helius Medical Technologies, have faced similar market backlash.
The development highlights ongoing concerns about the risks tied to corporate bets on Solana and other volatile assets.
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