$1.6 Billion Solana Treasury Bet: Biggest Signal Yet?

And what we can say definitively about Ethereum today is Ethereum still can't scale. Solana is really the only proven chain that can support global scale capital markets.

Kyle Samani is the chairman of Forward Industries, the largest treasury holder of sol. Because of that, he's been called the Michael Saylor of Solana. But his vision goes even further, bringing all of capital markets onto the Solana blockchain.

The biggest limitations strategy faces is just around the inherent limitations of Bitcoin itself. If you look at actual settled transactions per day, Solana can already support global scale securities markets.

Can Solana really become the new Wall Street? What are the main bullish catalysts for Sol? And what risks stand in the way? To find out, we sat down with Kyle in our latest cointelegraph interview. Disclaimer this video is for educational purposes only and does not represent financial advice. The cointelegraph team holds positions in Solana.

We kind of embarked on this journey to start Forward Industries a few months ago. And I think the kind of primary thing that got us really excited about the opportunity was actually recognizing a speech from SEC Chairman Paul Atkins. He gave a speech on July 31st called Project Crypto. He gave the speech to the approximately 4,500 employees who work at the SEC. And in the speech he told all of the employees unequivocally that we are going to move US securities markets on chain. And I just. When the speech first came out I couldn't believe it. How just clear it was in articulating the benefits of crypto to replace traditional systems like the DTCC and NYSE and NASDAQ and other systems. And the chairman of the SEC is basically saying like we need to throw away the old systems and move to the new one. It was just incredible. I still don't think the world at large fully appreciates what this means. And so after he gave that speech, you know, I was talking with the jump guys and the Galaxy guys who are my co sponsors on the pipe in the forward industries and we all said like dude, this is a bit. There's a big opportunity here not just to, to raise money and raise awareness for Solana, but to actually help advance the objectives of Project Crypto. And we're going to do that through a few things. Earlier this week we announced that we're tokenizing our own equity for our ticker is Ford F O R D. It's available today on most traditional stock brokerages and very soon it's going to be available on Solana mainnet. So you'll be able to buy and hold forward equity on Solana main net. You'll be able to use forward equity in Defi. We're already in touch with the teams at Jupiter lend Camino and Drift to facilitate, you know, forward equity as collateral in those systems. So we'll be able to use, you know, our equity on chain. Beyond that though, we see an opportunity to do all on chain, all capital markets operations on chain. And that means, you know, we want to do things like build a fundraise on chain for publicly traded company. We want to be able to do shareholder governance on chain, dividends on chain. Anything of this nature we'd like to be able to do. And so this is the kind of stuff where we're excited about and we're trying to accomplish for Forward ultimately so that we can prove to the world these things can be done. Making it easier for the, the second, third and fourth and fifth companies that want to do these things to know that there is a proven path ahead.

Yeah, that's all fascinating stuff and I'm going to dive deeper into those shortly. Just first I wanted to ask you, you, in the last couple of weeks, couple of months, you have been called the Michael Saylor of Solana because of your involvement with the treasury companies and Solana. Do you recognize yourself in this title?

You know, I'm, I'm very flattered that, that people think of me in that way. I, I know Michael and the team at, at Strategy. I actually had drinks with him last week in, in Washington D.C. we caught up on a number of items. I, I don't, I, I understand why people, you know, talk about the analogy like that. I'm not sure it's quite appropriate. Very happy with everything that that sailor did for, for Bitcoin and for the industry and really just pioneering this idea of a digital asset treasury company. But I, I'm optimistic that we can actually do more than what Strategy has accomplished. The biggest limitation strategy faces is just around the inherent limitations of Bitcoin itself. Bitcoin is digital gold, which is wonderful, but it's not this global financial engine in the same way that Solana aspires to be. And so we really look at our opportunity set at Forward Industries as a superset of what strategy is accomplished by being able to tap into defi to earning yield by doing staking by helping out build out the vision of project Crypto. We want to do all of these things in addition to credit amplification and driving, you know, sold per share. So I think our object, our, our aspirations are larger. But certainly we give a lot of credit where credit is due to Saylor and his team for pioneering everything that they have.

So let me understand if I underscore correctly, you, you say that the main differentiator between your treasury company, Solana treasury company and Sailor Strategy and other Bitcoin treasury companies is that Solana generates a yield while Bitcoin does not.

That is correct. That that is the foundation on top of which we can do many more interesting things. We can stake, we can lend, we can participate in defi. We, you know, already announced earlier this week that we are taking an an equity stake in in Superstate, which is our partner who is tokenizing the equity on on Salana main net. So we're able to use our scale, our reputation and our relationships to negotiate deals that are favorable for our shareholders. We did the first one with Super State. We announced it a couple days ago. We are looking to do the same thing with many other Defi protocols and I'm optimistic we'll be able to share more on that pretty soon.

It's a matter of weeks before we might see staking Solana DTF approved, which means that investors that can't get direct access to Solana will be able to do it through these dapps. So my question is why would an investor choose to put their money into your treasury companies instead of just putting them into a Solana stake etf?

Yeah. So I think there's a bunch of things we can do to outperform a Solana staking etf. The first is negotiating these, these deals with all of these counterparties. We announced the first one already with Superstate and in the coming weeks I think we'll be able to announce all a lot more with I optimistic half a dozen, if not more major teams around the ecosystem. That's the, that's the first thing we can do to outperform the staking ETFs. The second thing we can do is we can actually participate in Defi with the soul that we have because of the nature of LSTs. We can deploy our LSTs into DeFi and earn incremental yield on top of the staking yields. ETFs are never going to do that. And third is we can tap into our, our relationships in the credit markets to secure dollar denominated yields from banks and other lenders and deploy those dollars on chain and, and produce a spread in the cost of capital arbitrage. Meaning, you know, we can borrow I think in the 6 to 7% range. And deploy in the salon of defy, I think in the 12 to 15% range and earn that spread. So we can do. Those are just the very simple near term things that we can do to outperform a staking ETF on a little bit of a longer horizon. Then some more opportunities become available, the most notable of which is M and A. You know, the market. It looks like, I think there's 25 or 30 digital asset treasury companies already in existence. It looks like there might be more than 50. When all is said and done, I don't think the market is going to sustain 50 of these vehicles. And a lot of them are inevitably going to trade at a substantial discount to net asset value. And look, a lot of the people running those companies, they're here to make a quick buck and they want to leave and get out. And so I think the opportunity to buy those other asset treasury companies in a way that's accretive to our shareholders and to their shareholders will be doable.

Now you're talking about tokenizing your equity. So bringing the equity into the Web3 ecosystem. Why would an investor prefer tokenized forward equity than just trading a traditional equity on the nasdaq?

I think the answer to that is simple. There are a ton of people in the world today who don't have a traditional brokerage account. I would suspect most users on Binance do not have a traditional stock brokerage account. I think the same is true for most of the non US exchanges. And so those people actually cannot access forward even if they want to. The only way they're going to access forward is by token. By US tokenizing it being made available on Solana, it allows you to be available on some decentralized exchanges in the not too distant future. And then I'm optimistic that eventually the crypto CEFI exchanges such as Coinbase and Binance and Bybit and okay and others will list forwards equity and to make that available to their customers, a lot.

Of crypto holders do not have access to the possibility of trading directly strategy. So in it's great that you are essentially providing with the opportunity to people who don't have access to a traditional brokerage account to trade your equity, which supposedly is going to outperform Solana, as far as I understand.

Yeah, that's correct. There's 8 billion people in the world and different people want to access investments in different ways. And we want to enable people to own forward equity if they so choose across whatever platform they're on, whether that's a centralized platform or A decentralized one like Solana.

Okay, now I have, I have just a few concerns because a lot of people are warned about how these treasury companies will continue providing value to the investors in a period of sustained in the market downturn, like a bear market, for example. Some people are concerned about these companies going belly up, especially those that are involved with the riskiest practices. So what are your thoughts on your specific approach? How are we going to deal with those scenarios?

Yeah, so I think it's very much correct to flag that class of risk generally. And certainly we can already see a number of the digital asset treasury companies taking on a lot of risk both in their balance sheets and in kind of their operational decisions. You know, we are fortunate that our balance sheet is very large where we're the largest Solana based digital asset treasury company by a substantial margin. And so we have the balance sheet to withstand a sustained downturn. Multicoin has survived not one but two bear markets at this point. So we, we know how to survive. And second is, you know, we're being responsible with our use of leverage as of now forward Industries does not have any leverage. That may change in the future, but we have to be responsible with it. And we are certainly thinking, as I mentioned a few minutes ago, we have all of these interesting ways to earn excess yields both in sold denominated terms and dollar denominated terms. And we certainly want to make sure that our, to the extent we do use leverage, that our cash flow profile supports that leverage even in sustained bear markets. I think with responsible design we can do that.

When it comes to the tokenization of real world assets, when it comes to stablecoin, Ethereum has the first mover advantage in this field. I know that you are a long term Solana supporter, but in general why Solana and not Ethereum?

Yeah, I mean, you know, I've been in crypto for, personally for now nine years. Multicoin is going to turn eight years old in about a week here. And we've had a chance to understand these systems over a very long horizon. And what we can say definitively about Ethereum today is Ethereum still can't scale. Ethereum celebrated its 10th birthday a couple months ago. It's 10 years old. And today Ethereum mainnet processes something like 20 or 25 transactions per second. Something in that range. I know the Ethereum foundation has been talking recently about scaling the L1, but you know, you should judge them based on what they have done, not based on what they say they're going to do. Ethereum is 10 years old. They've had more than enough time to, to act and to operate and to deliver on whatever they needed to deliver on. Conversely, you look at Solana. Solana today is, is processing, you know, few thousand transactions per second as kind of steady state. And you frequently see demand spikes up to 10,000 transactions per second or more. Today, Solana is the most widely used blockchain number in terms of trading volumes and daily active addresses and most of the other metrics that show people using the system every single day. And so that, I think, is a very promising. And as we think about the future, you know, we think about this future of Internet capital markets. Unfortunately, for the last 40 years of the history of the Internet, finance has not felt like it's been part of the Internet. It's always been very siloed off. You know, the Internet is global. It's 24 7. It works from anywhere. Anyone can spin up a server or a website or post a photo on, on, you know, Instagram. And everything in finance is the opposite. Hours are limited, it varies by country. It's not open or accessible. The systems are closed. You have to have all this licensure to make anything work. And, um, crypto makes finance an Internet native primitive for the first time. It makes finance truly feel like just part of the Internet. And if you look at today where all of the leading builders are building who are doing new and novel things, they're all building on Solana. The, the highest profile example of this would be Pump. I think the correct way to understand Pump is Entertainment Finance 2.0. Entertainment Finance 1.0 was Jim Cramer. And for, you know, 20 years or whatever, he was kind of the only figure in the world in entertainment finance. And with the rise of Dave, with, I think after Covid happened, you got Dave Portnoy and his Green Hammer, you get Roaring Kitty and Gamestop, you get the rise of podcasts such as Cointelegraph and many others. And, and now you have all of these Twitch streamers, and now, of course, these Pump streamers. All of these are entertainment finance. And I think at this point, the leading intellectual capital in terms of building software systems and products, and all of the leading streamers are all on Solana today on Pumpkin. Um, and I don't think that's a coincidence. I think all of these people understand that if you're going to build Internet capital markets, you need to have this scalable, global, permissionless foundation on top of which you can build going to a streamer in India and telling them to run their system on base, they're going to look at this and say what are you talking about? You know, like this one server in Virginia. Yeah. That belongs to a publicly traded American company. So I really do think that, that Solana has proven itself as the home of Internet capital markets. And the last thing I'll say to this effect is, you know, you look at global securities trading today, Solana can process roughly 10 billion transactions per second. Excuse me, per day, plus or minus. If you look at the total number of securities trades in the world each day across New York Stock Exchange, nasdaq, London, Singapore, Hong Kong and all the other major securities venues around the world, they collectively meaning combined, clear fewer than 10 billion trades per day. Now there's with limit orders and cancels. Yeah, there's more than that. But if you look at actual settled transactions per day, Solana can already support global scale securities markets. We think that Solana is really the only proven chain that can support global scale capital markets. And that's why we've chosen to bet so big on Solana. Not even just in the last two or three months, but in the last eight years.

You mentioned the transaction per second of Solana as one of the main competitive advantages that it has over here. At the same time we know that there is a counter argument made by Ethereum supporter on X. His name is Ryan Bergmans. He comes software to our show. He points out the fact that soya is being marketed a lot for being able to process over 65,000 transactions per second. While actually that's just a theoretical benchmark while in real world the situations that figure is dramatically lower, usually about 1.5 thousand transactions per second. How would you address that?

Yeah, so look, the 65,000 number is very old at this point. And I mean I remember Anatoly pitched me that number back in 2018. Again, I think that if Ryan is flagging that number in 2025, that tells you his intention is to be dishonest because he's choosing not to use up to date information in his criticisms.

That was actually a comment that he made underneath a post by Pantera Capital. I think that Pantera is good using the number.

Well, I'm. It's unfortunate the Pantera guys haven't updated their marketing materials. I can tell you as a statement of fact, the Salana blockchain, they, they actually some of the developers did a test on Salana Mainnet, not Devnet, not test net, on globally distributed Salon mainnet maybe a month ago, a month and a half ago and the Salon Salana Network process about 107,000 transactions per second in this test. Now, that's not sustained, but it's been proven that you can, on a globally distributed mainnet, get there. So, you know, these criticisms I find all to be they're intentionally just trying to to deceive or mislead based on very old information. Moreover, if you just look at Solana's history, they have demonstrated a commitment to improving the performance of the system over a regular, regular basis. Ethereum launched 2015 at May five transactions per second, plus or minus. It's been 10 years and today it supports 20 or 25 transactions per second. So I mean, just look at the arc of time and that tells you what you need to know.

It.