- Metaplanet is borrowing 1 billion yen to purchase Bitcoin
- The loan is at a rate of 0.1% for a six-month term with a lump sum repayment
- It comes amid problems for the Japanese economy and stock exchange
Japanese investment firm Metaplanet has received a 1 billion yen ($6.8 million) loan from MMXX Ventures, one of its shareholders, to increase its Bitcoin reserves.
Metaplanet’s Strategic Crypto Move
The 1 billion yen loan from MMXX Ventures allows Metaplanet to acquire an additional 118.5 Bitcoins at current market prices.
Effective August 8, the loan agreement comes with an annual interest rate of 0.1% and a six-month term to be fully repaid by February 2024.
The loan follows Metaplanet’s recent announcement of a plan to raise $70 million through a rights offering, with $58 million earmarked for further Bitcoin investments.
Metaplanet’s Shift Toward Bitcoin Amid Economic Concerns
On May 13, Metaplanet outlined a strategy to use various capital market instruments to boost its assets, sharing MicroStrategy’s approach.
The move is seen as a hedge against Japan’s growing debt burden and the depreciation of the Japanese yen, as well as a response to the recent record drop in the Japanese market, the largest since 1987.
CEO Simon Gerovich, speaking at the Bitcoin 2024 conference, described how adopting Bitcoin has helped transform Metaplanet from a struggling “zombie” company to one with a more promising financial outlook.
Metaplanet’s Bitcoin Strategy and Market Impact
Since April 23, Metaplanet has purchased 246 Bitcoins worth about $13.95 million with an average purchase price of $65,145 per Bitcoin, reflecting a 12.8% decline from its initial investment.
However, even the recent drop in Bitcoin hasn’t caught Metaplanet, with Metaplanet’s share price up 290% since it first announced its Bitcoin strategy in April, although it has bounced back from a high of 3,000 yen ($20.50) in July to 643 yen ($4.39).
Conclusion
Metaplanet’s continued commitment to investing in Bitcoin, even in its moments of volatility, underscores its belief in the digital asset’s potential to mitigate financial risk and ensure long-term success, especially amid record drops in Japan’s stock market.
Japan could urgently see Bitcoin as a way to save its economic situation. It has been teetering on the brink for some time, and recently made that clear.
