Pantera Raising Fund to Buy up to $250M $SOL

Pantera is seeking funds for the Pantera Solana Fund, which has an “opportunity” to buy up to $250 million worth of SOL tokens from the FTX estate, according to marketing materials from February sent to prospective investors and seen by Bloomberg. In return for the option of buying SOL at 39% below a 30-day average price or at $59.95, investors must agree to a vesting period as long as four years.

Proposals like Pantera’s would allow FTX liquidators led by John J. Ray III to offload SOL and free up funds for creditors without putting immediate pressure on the token’s price. The estate holds 41.1 million SOL coins according to Pantera’s pitch document, worth $5.4 billion at Wednesday’s close and equivalent to roughly 10% of the total supply. The price of SOL jumped as much as 14% on Thursday.

SOL has soared almost 650% in the past 12 months as the crypto bull market gathered pace, creating an opportunity for the FTX estate to raise money for repaying creditors. The coin is trading at almost four times its price when FTX imploded in November 2022. FTX’s co-founder and former Chief Executive Officer Sam Bankman-Fried, who is awaiting sentencing on multiple counts of fraud, was a major backer of the Solana network.

Pantera was aiming to close the fund by the end of February, according to the investor pitch. The Menlo Park, California-based firm raised some money by the deadline, a person with knowledge of the matter said, asking not to be named discussing confidential information. The person declined to provide a dollar figure.

The trade-off for investors — who must put in at least $25 million each to participate — is that the SOL tokens will initially be locked and will vest gradually over four years. Pantera plans to charge a management fee of 0.75% along with a performance cut of 10%, the materials show.

Pantera isn’t the only outfit spotting an opportunity. Phoenix Digital LLC, founded by former Jefferies Financial Group Inc. credit trader Tian Zheng, has set up a similar vehicle and is seeking to buy SOL from the FTX exchange at $64 apiece, or a 51% discount to Wednesday’s close, according to marketing materials dated March 2 and seen by Bloomberg.

“Currently, [the FTX estate] is auctioning off Locked Solana OTC at a discount to spot price because of the large size and illiquidity of this block,” the Phoenix pitch deck said.

Investors in the vehicle, Phoenix Digital Series 2, are subject to a vesting period similar to Pantera’s. The locked-up tokens would be staked — a method of earning rewards for validating transactions on the Solana blockchain — to deliver an annual yield of around 7%.