Qualigen Shares Soar on $41M Investment, Crypto Pivot Led by Faraday Future
Electric vehicle maker takes a controlling stake to steer the former biotech towards Web3, rebranding the company to CXC10.
Shares of Qualigen Therapeutics, Inc. (NASDAQ: QLGN) skyrocketed after the company announced a pivot from biotechnology to the cryptocurrency sector, backed by a . The deal will see the electric vehicle (EV) maker and its founder take a controlling stake in Qualigen, which is set to be rebranded as CXC10 to reflect its new focus on Web3 initiatives.
The market responded with swift enthusiasm to the news, with Qualigen's stock surging over 83% in after-hours trading. The transaction represents a dramatic strategic shift for the clinical-stage therapeutics company, which will now abandon its previous business model entirely.
Under the terms of the Private Investment in Public Equity (PIPE) deal, Faraday Future (NASDAQ: FFAI) will invest approximately $30 million, with its founder and Global Co-CEO, YT Jia, personally contributing another $4 million. This secures a combined controlling interest of over 62% in Qualigen at an effective price of $2.246 per share. The remainder of the $41 million financing includes participation from other investors, notably the SIGN Foundation, which is backed by prominent venture firms like Binance Labs and Sequoia Capital.
Faraday Future justified the unusual move as a way to create a 'Dual Flywheel synergy' by integrating its Embodied AI (EAI) platform with the crypto economy. In a statement, the company explained the investment allows it to expand into the Web3 sector without diluting its own shareholders or diverting resources from its core EV business. As part of the overhaul, of the newly branded company, with other Faraday executives appointed to Co-CEO and CFO roles.
While investors reacted positively, some analysts have adopted a more cautious stance, highlighting the risks of the venture. For Faraday Future, which has faced its own financial struggles and production challenges in the competitive EV market, the deal represents a significant capital allocation into the volatile and largely unrelated crypto industry. For Qualigen's existing shareholders, the transaction brings considerable ownership dilution.
Despite the concerns, the involvement of established blockchain backers provides a degree of credibility to the ambitious pivot. The move positions Faraday Future at the crossroads of two high-growth industries, representing a that will be closely watched by the market.