The quotes of the Japanese public company Metaplanet increased by almost 90% after the announcement of the purchase of 1 billion yen (~$6.6 million) worth of bitcoins on the balance sheet as part of a new strategy.
Today, we're thrilled to announce a groundbreaking shift in our financial strategy, as we embrace Bitcoin as the core treasury asset of the Company going forward by committing an initial JPY 1 billion. This strategic pivot is not just about embracing digital assets but also about… pic.twitter.com/OASxj9IBPG
— Metaplanet Inc. (@Metaplanet_JP) April 8, 2024The firm called this the first step in transferring the treasury to the first cryptocurrency.
According to the statement, Sora Ventures, Mark Yusko of Morgan Creek Capital and other industry representatives helped implement the deal.
"The transition to bitcoin is an important milestone in our mission to lead in the digital finance era and positions Metaplanet as a pioneer in the introduction of cryptocurrencies in Japan," the statement said.
In a letter to investors, the company explained the decision to convert capital into cryptocurrency by the constant weakening of the yen as a result of the policy of negative rates. Bitcoin, despite the volatility, has been steadily growing over the years. According to the firm's expectations, digital gold will continue to outperform the Japanese currency.
"The company's decision to include bitcoin in its treasury assets is due to a multifaceted understanding of its potential as a means of protection against inflation, a tool for macroeconomic stability and a basis for long—term capital gains," Metaplanet stressed.
It is assumed that the company's investors will be able to indirectly own bitcoins, reducing the "exposure of their portfolio to the yen," and diversify it.
The closing price of Metaplanet shares reached 36 yen against 19 yen at the beginning of the trading session. The growth was 89.47%.
Data: MarketWatch.According to the company's website, it operates worldwide in the fields of Web3 consulting, real estate and investment. The company started a business called Red Planet as an operator of a chain of budget hotels.
Users noticed that the capitalization of Metaplanet is ~ $ 12 million, at the end of 2023 it was unprofitable. According to some, it is incorrect to compare the company with MicroStrategy.
Michael Saylor's company was the first company traded on the stock exchange to convert reserves into bitcoin in August 2020. After buying 9245 BTC in March 2024 for $ 623 million, the amount of cryptocurrency at her disposal reached 214,246 BTC — more than 1% of the issue.
According to BitcoinTreasuries, the capitalization of MicroStrategy is $25.7 billion, the share of bitcoin reserves in the indicator is ~59%.
Regarding the new Metaplanet strategy, a commentator under the nickname Pledditor warned:
"It looks like a big scam. This is a venture capital company dealing with shitcoins. So keep in mind that unlike MicroStrategy, you get access to their entire fund, including these tokens."
This looks like a major grift.
It's a shitcoin VC company, so just be warned unlike MSTR, you are exposed to the entirety of their fund which includes shitcoins
Recall that at the end of March, MicroStrategy stock quotes updated a 24-year high amid a recovery in the price of bitcoin.
Analysts at Kerrisdale Capital called the securities overvalued.