SCHEDULE: Avenue Capital Group Reduces Hyperion DeFi Stake

Avenue Capital Group entities report sales of Hyperion DeFi common stock, leading to changes in their beneficial ownership percentages.

Summary

• Avenue Venture Opportunities Fund, L.P. now beneficially owns 96,049 shares, representing 1.7% of Hyperion DeFi's common stock.
• Avenue Venture Opportunities Fund II, L.P. now beneficially owns 144,075 shares, representing 2.5% of Hyperion DeFi's common stock.
• Avenue Capital Management II, L.P. has sole voting and dispositive power over 240,124 shares, representing 4.2% of the class.
• Marc Lasry, as the ultimate beneficial owner, is associated with 240,124 shares, representing 4.2% of the class.
• The reporting persons' beneficial ownership is subject to a 9.99% blocker, which excludes shares issuable upon warrant exercise from current beneficial ownership calculations.
• The percentage of class is based on 5,694,659 shares of common stock outstanding as of August 11, 2025, as reported in Hyperion DeFi's Form 10-Q for the quarter ending June 30, 2025.
• This Amendment No. 6 reports sales of common stock by the Reporting Persons and the resulting changes in their beneficial ownership.

Sentiment

Score: 4

Explanation: The sentiment is slightly negative due to the reported sales of common stock by a significant investor group. While the overall percentage remains notable, the act of selling indicates a reduction in their stake, which can be interpreted as a less favorable outlook from these investors.

Negatives

• Reporting Persons have sold common stock, indicating a reduction in their investment in Hyperion DeFi.

Risks

• The existence of a 9.99% beneficial ownership blocker means a significant portion of potential shares from warrants are not currently counted, which could impact future market dynamics if the blocker is adjusted or warrants are exercised.
• Future sales by these significant shareholders could exert downward pressure on the stock price.

Future Outlook

The reporting persons' beneficial ownership is currently limited to 9.99% of the outstanding common stock due to a blocker. This blocker may be changed to up to 19.99% at the reporting persons' election upon at least 61 days' notice to the Issuer.

Industry Context

This filing reflects a change in a significant investor's position in Hyperion DeFi, a company likely operating in the decentralized finance (DeFi) or broader blockchain/crypto sector. Such changes in institutional holdings can signal shifts in investor confidence or portfolio rebalancing within the volatile digital asset space.

Stakeholder Impact

• Shareholders: May perceive the sales by Avenue Capital Group entities as a negative signal, potentially leading to downward pressure on the stock price.
• Company Management: May need to address investor concerns regarding the reduction in a significant shareholder's stake.

Next Steps

• Reporting Persons may elect to change their beneficial ownership blocker from 9.99% to up to 19.99% by providing at least 61 days' notice to Hyperion DeFi.

Key Dates

Recommendation

The filing indicates that a significant investor group, Avenue Capital Group, has reduced its stake in Hyperion DeFi through sales of common stock. While this is generally a negative signal, the group still retains a notable beneficial ownership and holds warrants. The 'blocker' mechanism also adds complexity to their full potential ownership. Given the sales, a 'buy' recommendation is not warranted, but the continued, albeit reduced, stake and warrant holdings suggest that a 'sell' might be premature without further information on the company's fundamentals or the investor's specific reasons for selling. Therefore, a 'hold' recommendation is appropriate, advising investors to monitor future filings and company performance closely.

Keywords

Hyperion DeFi, Avenue Capital Group, Schedule 13D/A, Beneficial Ownership, Common Stock, Investment Funds, Share Sales, Warrants, Marc Lasry