Author: Weilin, PANews
Metaplanet, a Japanese listed company, has announced large purchases of Bitcoin several times since April, and its frequent actions are considered to be imitating the American company MicroStrategy. As of May 23, Metaplanet held a total of 141.07 Bitcoins, with a market value of approximately US$9.6 million. Metaplanet CEO Simon Gelovich said in a recent interview that although becoming the Japanese version of MicroStrategy is a difficult goal, he hopes to provide Japanese investors with opportunities to invest in Bitcoin through a similar strategy.
Recently, Metaplanet has quickly boosted market sentiment after its transformation into Bitcoin investment. Driven by multiple rounds of good news, the company's stock price has experienced a strong growth of 360% in two months after a long period of slump. This trend is similar to the upward trend of MicroStrategy's stock price after investing in Bitcoin, and has also attracted the attention of many users.
Imitating MicroStrategy to invest in BTC, its main business used to be budget hotels
Metaplanet was formerly known as Red Planet Hotels, which was once a popular economy hotel brand among young people, with business operations in Thailand, Japan, the Philippines, Indonesia, etc. However, due to the epidemic, Red Planet Hotels experienced a sharp decline in operating income and staff layoffs.
Subsequently, the company laid out Web3 and Metaverse businesses, including the WEN Tokyo project, the Takumi-X project, and the NFT trading platform. Now, as the yen continues to fall against the dollar, it continues to adjust its corporate strategy.
Metaplanet's official website shows that the company's business is undergoing a transformation. The official website says: "Metaplanet (stock code 3350), a company listed on the Tokyo Stock Exchange, has begun to implement a strategic transformation. The company's strategic focus has shifted to Bitcoin. Metaplanet uses Bitcoin (BTC) as its main treasury reserve asset and uses excess cash flow to further accumulate Bitcoin. This strategic shift is due to Bitcoin's unique properties, such as its absolute scarcity and apolitical monetary policy."
Under the company’s business, Metaplanet has added a “Bitcoin Consulting” service: “Metaplanet provides specialized consulting services to help companies adopt Bitcoin. The company provides strategic guidance designed to maximize potential within existing corporate frameworks while overseeing entire corporate restructurings. From developing strategy to facilitating integration, Metaplanet helps companies use Bitcoin as a foundational pillar for future growth. In addition, Metaplanet actively develops strategic partnerships to promote global Bitcoin adoption. By working with industry leaders, Metaplanet promotes the continued monetization of Bitcoin on its path to becoming a major reserve asset.”
On June 25, Metaplanet stated on the X platform that it had established a wholly-owned subsidiary in the British Virgin Islands to strengthen the strategic management of BTC assets.
As the largest Bitcoin bull at present, MicroStrategy was originally an IT company mainly engaged in research business, but it successfully transformed after announcing the purchase of Bitcoin in August 2020, and its stock price rose rapidly. Despite the mixed reviews in the process of repeatedly borrowing and accumulating Bitcoin, its stock price has now reached 10 times the initial level. As of June 20, MicroStrategy held 226,331 Bitcoins with a total value of nearly US$15 billion.
Simon Gelovich, CEO of Metaplanet, said in an exclusive interview with the media: "Although becoming the Japanese version of MicroStrategy is a difficult goal, we hope to provide Japanese investors with the opportunity to invest in Bitcoin through similar strategies. Regardless of short-term price fluctuations, we plan to continue to purchase Bitcoin... We hope that Bitcoin will account for a large proportion of our balance sheet in the future." He said that the company "will be committed to widely disseminating the positive role of Bitcoin in Japan and abroad."
When asked if he would consider buying digital assets other than Bitcoin, Gelovich responded: “We only focus on Bitcoin. Because we believe that Bitcoin is the only truly decentralized digital asset. Although Bitcoin’s “Proof of Work” consensus mechanism is often seen as a weakness by supporters of other crypto assets or securities, in fact, it is one of Bitcoin’s greatest advantages. It is directly connected to the physical world through power input, making Bitcoin a scarce digital asset.”
Simon Gelovich said MicroStrategy's stock trades at a premium of 1.75 times its Bitcoin holdings. "We believe that if Metaplanet also maximizes its holdings of Bitcoin per share, it can enjoy a similar premium. In addition, we plan to conduct business in the Bitcoin ecosystem and look for additional revenue opportunities."
Regarding whether there are plans to "hedge" against Bitcoin price fluctuations? Gelovich said that he would consider various methods, but basically planned to invest and hold Bitcoin for a long time. We remain unwavering in our attitude towards price fluctuations. We not only regard fluctuations as "risks" in the traditional sense, but also as opportunities.
There was frequent buying of Bitcoin, and the stock price surged 360% in two months.
Since April, Metaplanet has been actively purchasing Bitcoin. On April 9, Metaplanet announced that it would work with Sora Ventures, Morgan Creek Capital's Mark Yusko and others to add $6.56 million worth of Bitcoin (BTC) to its balance sheet. Two weeks later, the company purchased an additional 19.87 Bitcoins. On May 13, Metaplanet further announced that it would use Bitcoin as a strategic reserve asset to hedge Japan's growing debt burden and the volatility of the yen.
On May 23, the company's stock price rose 158% in the previous week. Due to the sharp rise in stock prices, the Tokyo Stock Exchange suspended its stock trading for two consecutive days. On June 11, Metaplanet announced that it had increased its holdings by another 23.35 bitcoins, bringing its total holdings to 141.07 bitcoins, worth approximately $9.6 million.
The day before yesterday (June 24), Metaplanet announced that its board of directors had approved the use of 1 billion yen (about 7 million US dollars) to purchase Bitcoin. The funds will come from the issuance proceeds of the company's second ordinary bonds (with guarantees). According to the company's announcement, these bonds have an annual interest rate of 0.5%, which is expected to be paid on June 26, 2024 and mature on June 25, 2025.
Driven by the news, Metaplanet's stock price has soared 360% in two months since it transformed into investing in Bitcoin after a long period of silence. As of June 25, the company's stock price rose from 20 yen on April 1 to 92 yen. The highest point of the stock price was on June 13, reaching 112 yen. On June 25, Metaplanet's market value reached 16.15 billion yen (about 101 million US dollars).
This stock price trend of Metaplanet is very similar to the rise in stock price of MicroStrategy after investing in Bitcoin. Michael Saylor, chairman and co-founder of MicroStrategy, has started buying Bitcoin since 2020, and his company’s stock price has also experienced significant growth.
At present, Metaplanet's vision and ambition is not only to invest in Bitcoin, but also to use the opportunities within the Bitcoin ecosystem for diversified development. When asked whether Japan will launch a Bitcoin ETF, Gelovich said: "There is currently no Bitcoin ETF in Japan, which means that Japanese investors cannot easily invest in Bitcoin through securities accounts, so Metaplanet is committed to filling this gap.
He said, “Unlike ETFs, as an operating company, Metaplanet can access the capital markets and raise funds on terms that are favorable to shareholders. As the first Japanese listed company to strongly support Bitcoin, we have the ability to promote Bitcoin as a widely accepted monetary asset around the world through business expansion and information dissemination.”
In general, Metaplanet's strategic adjustment can be seen as a bold and innovative attempt, but it may also face challenges in the future. Over time, the market will witness how Metaplanet continues to create value in Bitcoin's journey, and its journey of exploration has just begun.
