Nasdaq Firm Tanks 50% on Shock $25M BONK Treasury Move

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• Safety Shot plans to invest $25M in Bonk memecoin for its treasury amid a strategic alliance.
  
• Shares dropped over 50% on investor concerns despite Bonk’s fast, low-cost Solana tech edge.
  
• Memecoin market has cooled 25% YTD, contrasting with a broader crypto market gain of 22%.

Shares in Nasdaq-listed drinks maker Safety Shot crashed by 50% following its announcement to purchase $25 million worth of the Bonk memecoin as part of a new corporate treasury strategy. The bold decision sparked investor concerns despite the company’s intent to integrate deeply with the memecoin ecosystem.

Safety Shot’s Strategic Shift to Bonk

On Monday, Safety Shot revealed a strategic alliance with the founding contributors of Bonk, signaling a pivot towards embedding the company within the memecoin space. The Solana-based token, Bonk, was chosen due to its “clear and distinct advantages” including superior technology enabling fast, low-cost transactions. According to Safety Shot, this positions Bonk ahead of rival memecoins like Shiba Inu (SHIB) and Pepe (PEPE), which are limited by Ethereum’s higher fees and slower speeds, and Dogecoin (DOGE), which faces inflationary challenges.

CEO Jarrett Boon described the move as “a bold first step in a much broader corporate evolution,” emphasizing the company’s alignment with one of the most dynamic digital asset ecosystems.

Market Reaction and Financial Position

Despite Safety Shot’s confidence, the announcement was met with skepticism by investors. The company’s stock (SHOT) plunged more than 50%, dropping to $0.59 in after-hours trading. This sharp decline reversed recent gains; shares had risen 36% over the past month but remain down 22.5% since the start of the year.

Safety Shot, formerly Jupiter Wellness, is known for its blood alcohol detox drink, Sure Shot. Ahead of this treasury move, the company paid off all outstanding debts and maintained a cash reserve of over $15 million. Additionally, it plans to issue $35 million in preferred shares convertible into common stock, potentially providing further financial flexibility.

Also Read: Solana Eyes $160 Breakout as Nasdaq Filing Sparks Institutional Interest

Memecoin Treasury Trend and Market Context

Safety Shot is among a growing number of companies exploring memecoin treasury reserves. Earlier in May, GD Culture Group announced a $300 million fundraising plan to build a crypto treasury including the TRUMP memecoin. However, the memecoin market has cooled off significantly, with its total market capitalization dropping 25% year-to-date, while the broader crypto market cap has grown by 22%.

Safety Shot’s bold bet on Bonk as a core treasury asset represents a novel strategy blending traditional business with emerging crypto trends. Yet, investor wariness is clear, underscored by the stock’s steep drop. How this memecoin integration shapes Safety Shot’s future remains to be seen as the company navigates the volatile crypto landscape.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses