Summary — Shareholders of Nasdaq-listed Sonnet BioTherapeutics Holdings, Inc. (SONN) approved a business combination on Dec. 2 that converts the small-cap biotech into a publicly traded digital-asset treasury vehicle focused on the HYPE token. The deal — completed after months of planning and postponements — brings an initial ~$888 million balance sheet into the combined company (HYPE tokens plus cash) and sets the stage for a planned capital raise of up to $1 billion to expand the HYPE reserve.
What happened
Sonnet shareholders voted to approve a business combination that merges Sonnet with parties backing Hyperliquid Strategies, Inc. (HSI) — the corporate vehicle that will run a HYPE-focused digital asset treasury (sometimes described as a Digital Asset Treasury, or DAT). Following the closing, Sonnet’s Nasdaq-traded shares (SONN) were suspended and the combined company’s securities are expected to begin trading under a new ticker (reported as PURR) on the Nasdaq Capital Market.
The financials: how big is the treasury at close?
The combination was structured to deliver a substantial starting asset base to the new treasury company:
- ~12.6 million HYPE tokens (reported valuation ≈ $583 million at the time of the announcement).
- ~$305 million in cash and cash equivalents, bringing the combined pro forma value to roughly $888 million on closing.
In regulatory filings and subsequent commentary, Hyperliquid has indicated plans to raise up to $1 billion additional capital specifically to accumulate more HYPE tokens and expand the treasury strategy — a move that would materially increase its stake and potential market impact.
Market reaction
Crypto market coverage and token-data services reported a price bump for HYPE following news of the shareholder approval and the prospect of a large, institutional-style treasury dedicated to the token. Several crypto outlets noted intraday gains for HYPE on the merger approval. Equity markets reflected the corporate change as Sonnet’s ticker was suspended pending the new listing.
Background — why Sonnet and why the pivot?
Sonnet originally announced the deal framework in mid-2025 in a business-combination agreement with Rorschach I LLC/Hyperliquid Strategies to form HSI, a public company whose primary purpose would be to hold HYPE and manage a treasury strategy. The plan aimed to combine Sonnet’s public listing status with institutional capital and HYPE token supply to create one of the first large-scale, token-focused public treasuries. The July announcement described the structure and the expected initial holdings; the closing in December completes that transition.
The closing came after a series of corporate steps and scheduling items (including adjourned meetings and regulatory processes) that extended the path from the July announcement to the December completion. Nasdaq’s corporate-actions bulletin confirms the transaction closed Dec. 2 and lists the effective timetable for suspension/listing changes.
What management says (official sources)
In its July filings and press release materials, the parties described the combination as creating a dual-track value proposition: a publicly traded vehicle managing a concentrated digital-asset reserve while keeping Sonnet’s biotech assets as a wholly owned subsidiary. Company statements highlight the size of the initial HYPE allocation and cash position as the foundation for the treasury strategy.
Risks and considerations
Analysts and market commentators have flagged several risks that investors should weigh:
- Concentration risk: The combined company will be heavily exposed to a single digital-asset (HYPE), which can be extremely volatile.
- Regulatory risk: U.S. securities and crypto regulatory stances remain evolving; a public company whose central asset is a native token may face heightened regulatory and disclosure expectations.
- Liquidity & market impact: A publicly declared plan to accumulate HYPE at scale (including a potential $1B raise) can push price volatility and draw scrutiny from market participants.
- Biotech legacy: Sonnet’s original biotech operations remain in the picture as a subsidiary — creating an atypical corporate structure combining biotech operations and a crypto treasury, which may complicate valuation.
Why this matters
If Hyperliquid (HSI) follows through on large-scale capital raises and token accumulation, it could be among the largest single-asset corporate treasuries built around a native blockchain token. That could change token economics for HYPE (supply concentration, price support, market signaling) and set a precedent for other public companies seeking to become token treasuries. However, outcomes depend on execution, market reception, and regulatory developments.
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