Tokyo-based Metaplanet to Issue 1-Billion Yen Bonds to Purchase Bitcoin

Metaplanet, an investment and consulting firm in Tokyo, is set to make a significant Bitcoin purchase. The company wants to issue bonds worth 1 billion yen (approx. $6.26 million) to raise funds to buy more Bitcoin tokens.

According to a June 24 announcement, the company’s board has approved this strategic move. Moreover, the soon-to-be-acquired Bitcoin is intended for long-term holding, underscoring Metaplanet’s confidence in Bitcoin’s potential. 

Metaplanet’s Strategic Bitcoin Purchase

According to another notice, the bonds will offer an annual interest rate of 0.5%. This will attract investors looking for stable returns while aligning with Metaplanet’s ambitious crypto strategy.

Following the announcement, Metaplanet’s stock significantly increased, climbing 11.5% to trade at 96 yen ($0.60). This surge continues a remarkable growth trend, with the company’s share price soaring over 500% since the start of the year, as reported by Google Finance.

Metaplanet’s announcement comes amid increased volatility in Bitcoin’s price. BTC recently hit a 40-day low, falling to $62,733, a 2.6% price decline in the past 24 hours.

This downturn comes after a substantial increase to $72,000 in early June, close to Bitcoin’s new all-time high recorded in March.

However, despite the current downturn, Metaplanet remains committed to its Bitcoin-driven strategy. If Metaplanet proceeds with the planned purchase of 1 billion worth of Bitcoin at the current price, the firm would acquire approximately 99.84 BTC.

This would substantially increase its Bitcoin holdings, which totaled 141.07 BTC following the acquisition of 23.25 BTC on June 11.

Comparisons to MicroStrategy

Interestingly, Metaplanet made its first foray into BTC in mid-May with a significant purchase of 117 BTC. Following that purchase, the company has adopted a “Bitcoin-first, Bitcoin-only approach” to its treasury management. This strategy came as a response to long-standing economic pressure in Japan.

Nonetheless, there have been several hurdles facing the firm’s BTC acquisition, particularly in its finances. The company’s holdings are currently valued below their purchase cost. This is due to the recent price drop compared to its average purchasing price of 10.28 million yen ($65,365) for each Bitcoin.

Remarkably, Metaplanet’s bold move into Bitcoin has drawn comparisons to MicroStrategy, a U.S. software firm recognized for holding vast amounts of Bitcoin.

Under the leadership of its CEO, Michael Saylor, MicroStrategy has been aggressively acquiring chunks of BTC. In 2020, the US-based firm adopted Bitcoin as its primary reserve asset. 

According to Bitbo data, MicroStrategy holds the record for the largest BTC reserves among public companies, with 214,400 BTC valued at approximately $13.4 billion. Notably, Metaplanet’s continuous investment in BTC is a strategy to create a hedge against economic instability using digital assets.

Moreover, the company’s decision to issue bonds for further BTC purchases reflects its acceptance of adopting digital assets as part of its financial portfolio. It aligns with the trend seen among several other corporations.