After the Japanese investment company Metaplanet announced the addition of Bitcoin treasury operations as a new main business line, shareholders did not react well.
Building on months of preparation and stock approvals, the company is soaring to new heights as a financial asset and revenue driver for Bitcoin (BTC), the world's largest crypto. Just yesterday, Bitcoin set a new all-time high above $108,000.
Metaplanet shares, which trade under the 3350 ticker on the Tokyo Stock Exchange, fell 13.73 percent to close at $22.90 (3,520 JPY) on Tuesday, according to Google Finance data.
The dip reflects mixed investor sentiment about the company's bitcoin-heavy strategy and market concerns over bitcoin volatility.
In the pivot, Metaplanet said it intends to increase its bitcoin holdings by hedging against the weakened Japanese yen and leveraging long-term debt and equity offerings.
“Moving forward, Metaplanet is committed to its role as Japan's leading Bitcoin Treasury company, recognizing its responsibility as a pioneer in the country's Bitcoin ecosystem,” the company said in a statement on Tuesday.
As part of its activities, Metaplanet will focus on buying, holding and managing Bitcoin through financial instruments such as loans, equity issuances and convertible bonds.
In order to measure the effectiveness of these purchases, the firm received BTC production in October. It is a performance measure that evaluates the growth in Bitcoin holdings relative to shareholder integration.
In addition to storage, Metaplanet also generates income by selling bitcoin options, using the asset's volatility to strengthen its financial position.
The Tokyo-based organization uses its exclusive license to Bitcoin Magazine Japan to integrate Bitcoin into its business and create new revenue streams through marketing and education initiatives.
The company has raised more than $140 million in equity, bond offerings and stock rights exercises since October. Most recently, it issued $30 million (¥4.5 billion) worth of zero-interest bonds to fund more Bitcoin purchases.
https://x.com/Metaplanet_JP/status/1868901119709335721
On Tuesday, Metaplanet released its forecast for the fiscal year ending Dec. 31, estimating revenue of $5.8 million (¥890 million), compared with $1.7 million (¥261 million) last year, a 240% increase.
https://x.com/Metaplanet_JP/status/1869172010506727560
Profits are expected to reach $1.8 million (¥270 million) in 2023, from a reported loss of $3 million (¥468 million).
“Combined with the strong performance of the hotel business […] The company is on track to post its first consolidated operating profit since 2017, the firm said.
As of December, Metaplanet holds 1,142. 287 BTC, worth $119 million, which is one of the largest corporate Bitcoin holders in Japan.
Edited by Stacy Elliott.
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