Sonnet BioTherapeutics Announces $888 Million Cryptocurrency Business Combination

PRINCETON, N.J., July 14, 2025 (GLOBE NEWSWIRE) — Sonnet BioTherapeutics, Inc. (NASDAQ: SONN) announced today that it has entered into a definitive agreement for a business combination with Rorschach I LLC, a new entity affiliated with Atlas Merchant Capital LLC. This deal aims to transform Sonnet’s operations by establishing a reserve of HYPE tokens, the cryptocurrency of the Hyperliquid Layer-1 blockchain.

Upon completion, the new entity will be called Hyperliquid Strategies Inc (HSI) and is expected to hold approximately 12.6 million HYPE tokens valued at $583 million, alongside gross cash proceeds of at least $305 million. This totals an estimated closing value of $888 million. Strategic investors involved in the transaction include Paradigm, Galaxy Digital, and Pantera Capital.

HSI will be listed on the Nasdaq Capital Market under a new ticker symbol. The cash raised will allow HSI to acquire additional HYPE tokens, solidifying its position as a major player in the cryptocurrency market. Bob Diamond, co-founder and CEO of Atlas, is set to take on the role of Chairman of HSI’s Board, while David Schamis will serve as Chief Executive Officer.

In addition to these appointments, HSI plans to bring on a new Chief Financial Officer and add experienced board members, including Eric Rosengren, former President of the Boston Federal Reserve. The business combination will also entail a Sponsor Advisory Agreement with Rorschach to integrate HYPE into HSI’s treasury management strategy.

Diamond expressed enthusiasm for the partnership, stating, “We are delighted by this opportunity to partner with Sonnet in establishing a leading crypto treasury management strategy.” Matt Huang, co-founder of Paradigm, noted, “Hyperliquid has broken out as a crypto project with real fundamentals. We see significant institutional demand for HYPE.”

Raghu Rao, Sonnet’s Interim CEO, stated that this merger provides a unique opportunity to enhance Sonnet’s financial stability and realize the value of its existing biotech assets. Nailesh Bhatt, Chairman of the Sonnet Board of Directors, highlighted the efforts made to navigate challenges and pursue this promising transaction.

The signing of the Business Combination Agreement includes the company raising $5.5 million through a private placement. The private placement is expected to close alongside the business combination. Sonnet’s existing shareholders will receive Contingent Value Rights related to its biotech assets, even as the company shifts focus post-merger.

The business combination is subject to approval by Sonnet’s shareholders and is expected to close in the second half of this year. Chardan is acting as the sole placement agent for the transaction.