Shares of Nasdaq-listed drinks maker Safety Shot plunged 50% after the company announced plans to invest $25 million in the Bonk memecoin as part of a new treasury strategy.
On Monday, Safety Shot revealed a strategic partnership with Bonk’s founding contributors aimed at deeply integrating the firm into the memecoin ecosystem.
The company explained that choosing Bonk as its primary treasury asset is due to its “clear and distinct advantages over competitors.”
The Solana-based token, Safety Shot noted, offers “superior technology enabling high-speed, low-cost transactions,” giving it an edge over rivals like Shiba Inu and Pepe, which face “high fees and slower speeds” on networks like Ethereum and inflationary Dogecoin.
Bonk is currently the fifth-largest memecoin by market cap, valued at $1.9 billion with 77 trillion tokens circulating. Although prices peaked in November 2024, they have since dropped 57% amid a cooling memecoin craze over the past six months.
Safety Shot said it prepared for the investment by settling all outstanding debt and maintaining over $15 million in cash. The company also plans to issue $35 million in preferred shares convertible into common stock.
“By aligning with one of the most exciting ecosystems in digital assets, we are taking a bold first step in a broader corporate evolution,” said Boon.
Safety Shot stock slumps
The announcement failed to win over investors, with Safety Shot’s stock (SHOT) plunging more than 50% on Monday, closing at $0.59 in after-hours trading.
Previously known as Jupiter Wellness, Safety Shot produces a blood alcohol detox drink called Sure Shot. CEO Jarrett Boon, who co-founded and led GBB Drink Lab, played a key role in developing the product.
While the company’s shares have gained 36% over the past month, they are still down 22.5% year-to-date.
Not the first company to embrace memecoin in its treasury strategy
This isn’t the first publicly traded company to adopt a memecoin treasury strategy. In May, GD Culture Group, a livestreaming and e-commerce firm, revealed plans to raise up to $300 million for a crypto treasury reserve that would include the US President’s namesake memecoin, TRUMP.
Since the start of the year, the memecoin market capitalization has dropped by 25%, while the overall crypto market cap has risen 22%, according to CoinMarketCap.
