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Metaplanet Latest Public Company to buy Bitcoin Pre-Halving: Is $6.6M Enough?

Last Updated April 9, 2024 2:30 PM
Giuseppe Ciccomascolo
Last Updated April 9, 2024 2:30 PM

Key Takeaways

  • Japanese Web3 infrastructure provider Metaplanet acquired $6.6 million of Bitcoin (BTC).
  • This move is a strategic way to reduce exposure to the weakening Japanese yen.
  • Metaplanet joined the large group of public companies that invested in BTC.

Leading Web3 infrastructure provider Metaplanet  has acquired $6.6 million worth of Bitcoin (BTC). The news boosted its Tokyo-listed stock by an astounding 90% surge in less than two trading sessions.

The company positioned this acquisition as a strategic move to minimize exposure to the Japanese yen. But also aims to solidify its stance as a pioneer in digital asset adoption within Japan. And it now joined a large group of public companies – especially in the US – to buy BTC.

Metaplanet Buys $6.6M BTC

Metaplanet , formerly known as Red Planet, initially operated as a budget hotel operator. Then, it transitioned into a Web3 software developer. The company has recently made a strategic move by acquiring Bitcoin. The decision, aimed at reducing exposure to the Japanese yen, reflects concerns over the yen’s vulnerability in Japan’s prolonged low-interest-rate environment. And it anticipates just of a few days the long-expected Bitcoin halving.

In an update  to shareholders, the company highlighted the yen’s diminishing stature as a global currency amid Japan’s persistent low-interest-rate policy. Notably, the central bank’s first rate hike in 17 years, raising short-term interest rates from minus 0.1% to 0-0.1%, underscores this concern.

Metaplanet’s decision to integrate Bitcoin into its treasury activities stems from a nuanced understanding of its potential benefits. The move serves as a hedge against inflation, enhances macroeconomic resilience, and offers prospects for long-term capital appreciation.

The initiative is demonstrating far-reaching impacts beyond its original scope. Moreover, Metaplanet’s acquisition of BTC was executed distinctively. It garnered support from prominent entities such as Sora Ventures, Morgan Creek Capital’s Mark Yusko, and others.

Boosting BTC Among Japanese Users

For Metaplanet, Bitcoin represents not only a potential source of investment gains. However, it also has implications that extend to the broader cryptocurrency industry.

This announcement underscores the growing significance of Bitcoin within the Asian region. By providing investors with a regulatory-compliant avenue to access BTC, Metaplanet is pioneering a path for public companies in the region to follow suit.

In a post  on X, Jason Fang, managing partner and co-founder of Sora Ventures, emphasized the partnership’s significance in enabling Japanese investors to gain exposure to crypto through a publicly traded entity. This approach offers an alternative to holding the asset directly, he said. It also mitigates concerns about the high tax levied on unrealized crypto gains.

“Excited to announce that Sora Ventures is working with Metaplanet, a listed company on the Tokyo Stock Exchange, to create Asia’s first Microstrategy. The product will enable the Japanese to gain exposure to Bitcoin without paying an unrealized gains tax that could go as high as 55%. It will also enable anyone with an account to Tokyo Stock Exchange to gain exposure to Bitcoin without any regulatory risks. I will be joining the board on the listed company. The investment round also included UTXO Management, Mark Yusjo and Jack Liu.”

Largest BTC Holders

By investing in Bitcoin, Metaplanet joins a growing list of publicly listed companies  leveraging Bitcoin to enhance shareholder value. While MicroStrategy led the charge by pioneering this model and demonstrating its efficacy on multiple occasions, broader institutional adoption appears increasingly promising.

As the world’s largest corporate holder of Bitcoin, MicroStrategy boasts 214,246 Bitcoin, valued at approximately $15.0 billion. Based in Virginia, this intelligence software firm initiated its Bitcoin acquisitions in 2020, rapidly expanding its holdings to dwarf its peers. MicroStrategy’s stock surged over 350% in 2023, buoyed by its substantial Bitcoin reserves.

Largest Bitcoin holders
Largest Bitcoin holders. l Source: BitcoinTreasuries.net

Tesla ranks third among corporate Bitcoin holders, with holdings valued at $554.2 million. In 2021, the company invested $1.5 billion in Bitcoin to bolster its financial performance and provide liquidity to customers who could purchase its products using the cryptocurrency. However, during the subsequent crypto market downturn, Tesla sold a significant portion of its Bitcoin holdings at a substantial loss.

Additionally, two Canadian companies, Hut 8  and Hive Blockchain , stand out as prominent Bitcoin holders. These cryptocurrency mining firms have witnessed impressive share price increases of over 191% and 144%, respectively.

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