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Crypto Journalist
Anas Hassan
Crypto Journalist
Anas Hassan
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Nasdaq has scold TON Company strategy for breach of shareholder approval requirements in connection with its $272 million purchase of Toncoin and related private placement financing.
The company will remain listed on the exchange after regulators determined the violations were unintentional rather than deliberate attempts to circumvent compliance rules.
TON Strategy received the formal Letter of Reprimand on October 28, following an investigation into its August 2025 transaction structure.
The firm avoided delisting after Nasdaq staff concluded it had inadvertently violated listing rules during a 558 million of private investment which funded its shift into blockchain treasury management.
Two Violations Related to the Purchase of Toncoin
The reprimand addresses two separate compliance failures under Nasdaq Listing Rules 5635(a) and 5635(b).
The first violation comes from the company August 7 private placementwhich raised capital through the sale of approximately 58.7 million pre-funded shares and warrants at $9.51 per unit.
Nasdaq determined that this transaction resulted in a change of control after the executive chairman, through Kingsway Capital Limited Partners, acquired approximately 19.99% of the property with a major management restructuring.
The second breach involved the $272.7 million Toncoin purchase agreement executed by a subsidiary of the company on July 31.
Because 48.78% of the proceeds of the private placement will finance the purchase of digital assets, which represents a multiple of the number of pre-financing shares of the company, the Nasdaq established that the prior approval of the shareholder was mandatory under Rule 5635 (a).
The company relied on outside advisors who believed the transaction complied with existing regulations.
Nasdaq noted in its letter that the closing of the Toncoin purchase was contingent upon the completion of the private placement.
The substantial proportion of financing directed towards digital assets has triggered the requirement that the company obtain shareholder consent before issuing shares representing 20% ​​or more of outstanding shares or voting power in connection with the acquisition of assets.
The Company accepts the sanction, commits to future compliance
Nasdaq determined that the TON Strategy did not show a pattern of non-compliance and appeared to have inadvertently violated the rules, based on staff discussions with the company’s leadership.
The regulator weighed these factors alongside the firm’s commitment to work with the exchange on future compliance issues before issuing the reprimand rather than pursuing delisting proceedings.
After the disclosure of the reprimand through a presentation of Form 8-K on October 29, there is no further action by the company.
TON Strategy has accepted the staff’s determination and considers the matter closed, with its shares continuing to trade on Nasdaq under the ticker TONX.
The strategic shift reflects a broader institutional trend
The company, formerly known as Verb Technology, rebranded as TON Strategy after the August transaction which positioned it as the first US trading firm to adopt Toncoin as a core treasury asset.
At the time of the announcement, shares were up 193.38% due to investor enthusiasm surrounding the blockchain integration strategy, even as Toncoin itself declined by 3.3%.
The company plans to keep 77% of the capital raised in liquid assets while aiming to acquire up to 5% of Toncoin’s circulating market capitalization.
The strategy involves generating performance through the staking mechanisms of the TON network, with the company expecting positive cash flow returns over time.
This approach resembles SOL Strategies’ institutional validator framework on Solana, which raised $500 million through convertible notes and has accumulated more than 260,000 SOLwith about 60% staked for returns ranging from 6% to 8%.
The digital asset treasury model has gained momentum in many networks beyond Bitcoin-centric strategies.
Tom Lee’s company Fundstrat, BitMine Immersion Technologies, recently accumulated 379,271 ETHfor a value of about $1.5 billion, through three major purchases, becoming the largest holder of Ether treasure with more than 3 million. ETH.
The company seeks to eventually control 5% of all Ether in circulation, having started its accumulation in early July when prices were close to $2,500.
TON Strategy has anchored its stake in the Open Network’s native token, which benefits from deep integration with Telegram, which has designated TON as its exclusive blockchain partner for advertising, mini-apps and tokenized assets.
