SOL Strategies Secures $500M Convertible Note Facility to Boost SOL Purchases and Validator Growth

In a landmark move, SOL Strategies has unveiled a strategic financing facility worth up to $500 million USD through a convertible note facility with ATW Partners, a New York-based firm.

The capital raised will be exclusively used to acquire SOL tokens, which will then be staked on validators operated by SOL Strategies itself.

The facility’s novel structure allows SOL Strategies to issue up to $500 million in Notes, with an initial tranche of $20 million expected to close around May 1, 2025.

What makes this facility particularly groundbreaking is its connection to staking yield. The interest on the Notes will be paid in SOL, capped at 85% of the staking yield generated by the SOL acquired through the facility.

This model effectively creates a self-sustaining financial loop, where every dollar of deployed capital generates yield from day one.

“This is the largest financing facility of its kind in the Solana ecosystem—and the first ever directly tied to staking yield,” said Leah Wald, CEO of SOL Strategies, in a statement shared with Cryptonews.

“Every dollar deployed is immediately accretive to our balance sheet and validator business. This structure is not only innovative—it is highly scalable.”

The deal also includes an optional conversion of Notes into common shares at prevailing market prices, enhancing potential upside for ATW Partners while aligning incentives across both parties.

Cohen & Company Capital Markets is serving as the placement agent for the offering, for which it will receive a 4% finder’s fee.

Validator Expansion, Strategic Partnerships, and a New Era of Institutional Staking

SOL Strategies’ validator-first approach is already bearing fruit. Just this month, the company entered into a strategic partnership with Pudgy Penguins to launch the PENGU Validator, a new validator.

Pudgy Penguins, famous for its viral NFT collection and growing toy empire, is now venturing into infrastructure, choosing SOL Strategies as its validator partner of choice.

The PENGU Validator is accessible through the Phantom wallet interface and offers yields ranging from 7% to 11%, depending on network conditions.

The partnership is just one facet of a broader strategy. In March 2025, SOL Strategies aggressively expanded its validator footprint by acquiring three major Solana validators, including Laine, one of the ecosystem’s most respected operators, and the validator analytics platform Stakewiz.com.

The $24 million deal instantly doubled SOL Strategies’ total SOL stake to over 3.35 million tokens, valued at approximately $388 million.

Michael Hubbard, founder of Laine, has also joined the company as Chief Strategy Officer.

Under his guidance, SOL Strategies is optimizing validator performance, delivering 99.955% uptime and a 7.41% average delegator APY in March, while also developing high-value institutional partnerships, such as the one with Pudgy Penguins.

Convertible Note Financing as a Strategic Tool for Growth

Governance also plays a crucial role in SOL Strategies’ expanding influence. In March, the firm confirmed that all its validators voted in favor of SIMD-228, a proposal aimed at reducing Solana’s inflation rate from 4.5% to 0.87%.

Though the proposal garnered 61.4% approval, it narrowly missed the required two-thirds threshold. Still, SOL Strategies’ alignment with deflationary economic policy highlights its vision for a sustainable Solana ecosystem.

Meanwhile, the company’s innovative use of convertible notes draws comparisons to GameStop’s recent $1.5 billion sale of convertible senior notes.

GameStop announced plans to use a portion of the proceeds to buy Bitcoin, aligning its strategy with crypto-treasury pioneers like MicroStrategy.

However, where GameStop and MicroStrategy focus on holding BTC as a treasury asset, SOL Strategies takes a step further, using capital to stake SOL and generate an ongoing yield actively.

This approach could be more sustainable, offering long-term upside through validator operations and token appreciation while preserving liquidity through Note conversion options.

Together, these initiatives position SOL Strategies at the heart of Solana’s evolving institutional space.

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