DeFi Technologies CEO Says Stock Drop Was Driven by Crypto Weakness and Fundraising Factors

DeFi Technologies CEO and Executive Director Johan Wattenström issued a letter to shareholders responding to the company’s recent share price decline. According to Foresight News, Wattenström said the drop was mainly driven by weakness in the crypto market, outflows from the crypto stock sector, and technical factors tied to the latest financing. The company said its balance sheet stood at about $150 million at the end of the first quarter, with profitability and nearly zero debt. Wattenström said this puts DeFi Technologies in a stronger position than during the last bear market, when its stock briefly fell below $0.10 and the company carried more than $40 million in debt. The letter said the company’s first hedge fund is set to launch soon and that it plans to expand its arbitrage strategy in the second half of the year. It also said the Swedish Financial Supervisory Authority, Finansinspektionen, rejected an application for a UCITS structure tied to crypto-related assets, and the company has filed an appeal while working to build a UCITS platform in other parts of the European Union. Wattenström said the Valour Custody platform is expected to launch in the second half of the year. He also said the company is actively seeking large-scale acquisition opportunities and clarified that there are no current plans for a reverse split, though the option remains available if needed to meet Nasdaq rules. He added that 73% of shareholders previously voted to keep that option available.