Metaplanet Secures 1 Billion Yen Loan to Acquire Additional Bitcoin

Highlights:

• Metaplanet obtains a $6.8 million loan from one of its shareholders to increase Bitcoin holdings.
• The company plans to raise 8.5 billion yen through a stock offering for Bitcoin investment.
• Metaplanet’s stock fell sharply from highs amid market turmoil.

On August 8, Japanese investment firm Metaplanet announced it had secured a loan of one billion Japanese yen ($6.8 million) from one of its shareholders to acquire more Bitcoin (BTC). The loan obtained from MMXX Ventures Limited carries an interest rate of 0.1% per annum with a six-month term. If nearly 100% of the $6.8 million loan were used to buy Bitcoin, the firm could acquire an additional 118.5 Bitcoins at current market prices. The firm said it will repay the loan in a lump sum. 

*Metaplanet secures ¥1 billion 0.1% APR loan; proceeds to fund additional purchases of $BTC* pic.twitter.com/seN6YdrnLO

— Metaplanet Inc. (@Metaplanet_JP) August 8, 2024

Metaplanet to Invest $58.76M in Bitcoin

Metaplanet has shown strong confidence in Bitcoin by using both debt and equity financing to increase its BTC holdings. The firm’s approach is inspired by MicroStrategy’s Bitcoin strategy, which has been accumulating Bitcoin since 2020.

On August 5, Metaplanet revealed its plan to invest about 8.5 billion Japanese yen ($58.76 million) in Bitcoin through a new stock offering. The company aims to raise a total of 10 billion yen ($69.13 million) by issuing stock acquisition rights to all common shareholders. The decision was made during a Metaplanet Board of Directors meeting. All common shareholders will receive stock acquisition rights starting September 5, with the allotment taking effect from September 6 onward.

*Metaplanet announces ¥10.08 billion Gratis Allotment of Stock Acquisition Rights; proceeds to fund additional purchases of $BTC* pic.twitter.com/4OdTFdHnfF

— Metaplanet Inc. (@Metaplanet_JP) August 6, 2024

In its disclosure, Metaplanet cited Japan’s high debt levels, persistent negative interest rates, and a weakening yen as key factors driving its decision to acquire more Bitcoin. According to Bitcoin Treasuries data, Metaplanet has acquired 246 Bitcoins, valued at $13.95 million at current market prices, through seven separate transactions. The firm’s average Bitcoin purchase price is $65,145, which is 12.8% lower than when it first invested on April 23.

Metaplanet’s Stock Skyrockets 364% in Six Months

Metaplanet’s stock price has surged 364% in the past six months, trading at 743 yen ($5.08) on Thursday. Google Finance data shows that the company’s stock price has increased by 290% since it announced its Bitcoin plan on April 9, reaching $4.39 (643 Japanese yen). However, it has declined from its yearly high of $20.50 (3,000 Japanese yen) recorded on July 24. This decline was worsened by the cryptocurrency industry’s “Black Monday” on August 5, when Bitcoin dropped 10% within just two hours.

Bitcoin Purchases Surge Amid Market Downturn

On-chain data reveals a surge in Bitcoin whale buying during this week’s market crash. According to blockchain analytics firm Santiment, transactions from whale wallets holding 10 to 1,000 BTC spiked on August 5th and 6th, rapidly accumulating as soon as the price dropped below $50,000.

🐳 August 5th and 6th saw the highest level of Bitcoin whale transactions since the first week of April. According to the total holdings of wallets with 10 to 1,000 BTC, they rapidly accumulated on the price dip that saw crypto's top asset fall below $50K. pic.twitter.com/wLG33tIV2k

— Santiment (@santimentfeed) August 7, 2024

Meanwhile, Bitcoin ETF inflows rebounded on Wednesday, August 7, turning net positive. BlackRock’s IBIT saw inflows of $52.5 million, while Grayscale’s GBTC experienced $30.6 million in outflows. Conversely, Japan’s financial regulators, like those in Hong Kong and the US, are cautious about approving cryptocurrency ETFs.

Hideki Ito, the head of the FSA, said many believe crypto assets may not consistently and long-term contribute to wealth creation for the Japanese public. Metaplanet, currently listed on the Tokyo Stock Exchange (TSE), restricts access for US investors. The firm plans to tokenize its shares on the Bitcoin layer-2 network, Liquid.

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