Web3 infrastructure provider Metaplanet (3350) has seen a surge in its Tokyo-listed stock by nearly 90% within just two days after adding $6.56 million worth of Bitcoin (BTC) to its balance sheet.
According to data from Google Finance, the company’s shares are currently trading at 36 yens, up by 89% over the day.
The surge is largely attributed to Metaplanet’s move to add Bitcoin to its balance sheet, which came in collaboration with Sora Ventures, Mark Yusko from Morgan Creek Capital, and other prominent partners.
Metaplanet, previously known as Red Planet and operating as a budget hotel operator, has transitioned into a Web3 software developer.
Metaplanet Buys Bitcoin to Hedge Against Inflation
Earlier this week, Metaplanet revealed its decision to incorporate Bitcoin into its treasury assets due to several factors.
Firstly, it aims to minimize its exposure to the Japanese yen, which has been significantly impacted by Japan’s low-interest-rate environment.
Over the years, the yen has lost its position as a major global currency.
In a shareholder update, Metaplanet expressed concern about the yen’s vulnerability and highlighted Bitcoin’s potential as a hedge against inflation, a tool for macroeconomic resilience, and a source of long-term capital appreciation.
The company’s strategy closely resembles that of MicroStrategy, a software developer based in Tysons Corner, Virginia.
MicroStrategy made headlines in 2020 when it announced its intention to accumulate bitcoin as part of its corporate treasury holdings.
Since then, MicroStrategy’s stock price has frequently mirrored the fluctuations in Bitcoin’s value, reflecting investors’ sentiment toward the cryptocurrency market.
Presently, MicroStrategy holds the largest corporate bitcoin reserves, with more than 214,000 bitcoins valued at over $15 billion, according to bitcointreasuries.net.
Jason Fang, the managing partner and co-founder of Sora Ventures, shared his perspective on the partnership with Metaplanet.
He emphasized that this collaboration offers Japanese investors an opportunity to gain exposure to cryptocurrencies through a publicly traded company, eliminating the need to hold the assets directly.
This alternative investment avenue also mitigates the high tax imposed on unrealized crypto gains, which has been a contentious issue in Japan.
Excited to announce that @sora_ventures is working with @Metaplanet_JP, a listed company on the Tokyo Stock Exchange to create Asia’s first Microstrategy. The product will enable Japanese to gain exposure to bitcoin without paying an unrealized gains tax that could go as high as… https://t.co/TvAosMDDOM
— Jason Fang ᛤ (@JasonSoraVC) April 8, 2024
Corporate Bitcoin Holders Start to Reap Rewards
A number of major corporate investors in Bitcoin, including Microstrategy, have already seen their profits skyrocket.
As per data aggregated by Saylortracker, at current market prices of around $65,000, MicroStrategy’s position now commands a total valuation exceeding $12.57 billion.
This means the company sits on tremendous unrealized profits of almost $6.5 billion on paper – reflecting a gain of almost 104% yield-to-date from an investment allocation started under Saylor back in 2020.
As of now, Bitcoin is trading at around $69,000, down by more than 3% over the past day.
The leading cryptocurrency is 5% away from its all-time high of $73,750 registered on March 14.
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