Metaplanet Faces Funding Strain as Stock Tumbles

With 18,991 BTC already held, the company aims for 100,000 BTC by 2026 but is now turning to overseas share offerings and preferred stock issuance to raise ￰0￱ warn the collapse of its “Bitcoin premium” from 8x to 2x heightens dilution risks, though Metaplanet’s recent upgrade to FTSE Japan’s mid-cap index offers somewhat of a silver ￰1￱ Faces Pressure Metaplanet, the Tokyo-listed firm known for its aggressive Bitcoin accumulation, is facing some financial strain as its share price continues to ￰2￱ company’s stock plunged by more than 50% since mid-June, even as Bitcoin was able to gain around 2% over the same period. Metaplanet’s stock price over the past month () The sharp decline undermined Metaplanet’s capital-raising “flywheel” strategy, which relies on rising stock prices to unlock funding through MS warrants issued to Evo Fund, its key ￰3￱ the current share price drop, exercising these warrants became unattractive for Evo, tightening Metaplanet’s liquidity and slowing down its Bitcoin acquisition ￰4￱ is led by former Goldman Sachs trader Simon Gerovich, and it amassed 18,991 ￰5￱ makes it the seventh-largest public Bitcoin holder according to ￰6￱ company also set ambitious targets of holding 100,000 BTC by 2026 and 210,000 BTC by ￰7￱ with its existing strategy faltering, Gerovich is now looking for alternative funding ￰8￱ public Bitcoin treasury companies () Last week, Metaplanet announced plans to raise roughly 130.3 billion yen ($880 million) through a public share offering in overseas ￰9￱ addition, shareholders will vote on whether to approve the issuance of up to 555 million preferred shares, which could raise as much as 555 billion yen ($3.7 billion).

Gerovich described the preferred shares as a defensive mechanism, offering capital without diluting common shareholders if the stock falls even ￰10￱ preferred stock is expected to carry up to 6% annual dividends and is initially capped at 25% of Metaplanet’s Bitcoin holdings, which may prove appealing to yield-hungry Japanese ￰11￱ these efforts, analysts warn that the success of Metaplanet’s strategy hinges on the “Bitcoin premium”—which is the difference between its market capitalization and the value of its Bitcoin ￰12￱ premium collapsed from over 8x in June to just 2x, raising concerns about future ￰13￱ company already suspended Evo’s warrant exercises for most of September to facilitate the preferred share ￰14￱ this pivot will restore momentum to its funding model remains to be seen.

Nonetheless, Metaplanet earned an upgrade from small-cap to mid-cap status in FTSE Russell’s September Semi-Annual Review, securing inclusion in the FTSE Japan Index after its strong second-quarter performance.