DeFi Development closes Strategy-style $11 million CHAD offering to grow Solana treasury

Solana treasury firm DeFi Development Corp. has closed and launched its preferred stock offering, marking the launch of what it calls the first SOL-backed "Digital Credit" instrument.

CHAD carries a 13% initial annual dividend rate and will fund additional SOL purchases, giving the Nasdaq-listed DeFi Development Corp. another way to grow its SOL holdings without issuing common shares. The offering, which closed at $11 million, included participation from Fundstrat's Tom Lee.

CHAD is a Variable Rate Series C perpetual preferred stock, with an initial annual dividend rate of 13%, equivalent to an initial effective yield of approximately 16.25% based on the offering price. The first regular dividend payment is set to occur on Oct. 1.

"CHAD represents a major milestone for DFDV and for the evolution of Digital Credit," said DeFi Development CEO Joseph Onorati. "For the first time, investors can access Digital Credit backed by Solana, while DFDV gains a new source of permanent capital that can be deployed directly into additional productive SOL."

DeFi Development Corp. recently resumed Solana purchases, acquiring roughly 19,000 SOL to bring its holdings to approximately 2.33 million SOL and SOL equivalents.

CHAD is similar in concept to Strategy's preferred-stock offerings. A notable difference is that DeFi Development is pitching CHAD as a new form of "digital credit" because SOL can generate staking/validator yield, whereas Strategy's securities are ultimately backed by a Bitcoin treasury.

"The immediate benefit is straightforward: we expect this transaction to increase SPS without increasing our common share count," Onorati said in a release. "But the much larger opportunity is what CHAD can become. If we establish the instrument around par and scale it over time, we believe CHAD can help accelerate the capital markets flywheel that allows DFDV to aggressively accumulate SOL and compound SOL per share."