Metaplanet invests 1 billion yen in Bitcoin! Sora Ventures builds Asia micro strategy?

Metaplanet Corporation (3350:JP) announced on 4/8 that its board of directors has approved the purchase of Bitcoin and will invest up to 1 billion yen as the main part of financial assets. Metaplanet will invest in cryptocurrency strategic changes, laying the foundation for innovative financial practices in the Japanese capital market.

Sora Ventures and other capitals have invested in Metaplanet and introduced Bitcoin strategies

What does Metaplanet do? Why start buying Bitcoin?

Metaplanet Corporation (3350:JP) is a multi-business company founded in 1999 with a hotel, Hotel Royal Oak. It was listed on the Tokyo Stock Exchange (TSE) in 2004. Among its many businesses, it also includes Web3 consulting business. However, the company has not had a good profit performance in the past few years, and its stock price is also quite sluggish. The Japanese market evaluates it as a company that is seeking to rebuild its business and invest in Metaverse and Web3.

It was announced on April 8 this year that Sora Ventures, 210k Capital and other capitals and individuals purchased a total of 46,750,000 shares of Metaplanet from EVOFUND and MMXX, accounting for approximately 41% of the shares (number of issued shares 114,692,187).

The entry of these capital also made Metaplanet decide to start buying Bitcoin and will generate income by holding Bitcoin.

Why choose Bitcoin? Analyzing Metaplanet’s strategic choices

Metaplanet stated that the decision to incorporate Bitcoin into its financial strategy stemmed from several key economic indicators and market dynamics:

• The continued depreciation of the yen : Japan’s currency has depreciated significantly over the years, a phenomenon exacerbated by a prolonged low interest rate environment.

• The Rise of Cryptocurrencies: Despite initial skepticism, digital currencies such as Bitcoin have now become a fixture in the global financial landscape, with some countries even incorporating them into their national monetary systems.

• Historical Performance: Over the past decade, Bitcoin has not only proven its resilience but has continued to appreciate in value, becoming a solid long-term investment.

Strategic Reasons for Bitcoin Integration

Metaplanet has a multi-faceted rationale for adopting Bitcoin, aiming to leverage the cryptocurrency as a tool against inflation and macroeconomics Means of Stability:

• Fighting Inflation and Currency Hedging: In an era of significant inflation, Bitcoin’s fixed supply stands in sharp contrast to the possible depreciation of fiat currencies.

• Economic Stability: Bitcoin provides stability amid global economic uncertainty and is not affected by the economic policies of any single country.

• Mainstream acceptance and growth potential: In the context of the approval of the US Bitcoin ETF, its legitimacy and huge growth potential have been confirmed.

• Technological Innovation: This move also demonstrates the company’s commitment to utilizing the latest financial technology for effective financial management.

Comprehensive Bitcoin Buying and Risk Management Policy

To cope with the complexities of its new digital asset strategy, Metaplanet has developed a comprehensive set of risk management policies, These include:

• Roles and Responsibilities: Assign specific roles, such as Chief Investment Officer and Chief Executive Officer

• Market Pricing and Valuation: Establish the appropriate financial Reported Pricing and Valuation Methodology

• Security and Custody: Addresses custody and security measures to protect assets

• Investment Oversight: Clearly Defined Bits Coin investment management and supervision policy

Metaplanet’s stock price soared nearly 90% in a single day

Metaplanet rose nearly 90% on 4/9, the highest level in the past year.

Metaplanet said it plans to regularly assess the value of its Bitcoin holdings, conducting quarterly market capitalization reviews. Any material financial impact will be disclosed promptly to ensure transparency and regulatory compliance. This strategic move not only capitalizes on the changing financial landscape, but also puts the company at the forefront of financial innovation in Japan, potentially setting an example for other companies in the region.

What is the problem of Japanese companies holding virtual assets?

According to the Japan National Tax Agency’s “Basic Access to Corporate Taxes” amendment, in the future, companies will not need to pay virtual currency tax on unrealized profits if they meet the conditions. In the case of Metaplanet, it is necessary to "obtain a technical measure that prevents it from being transferred to others" for at least one year before it will be taxed at the end of the year.

In any case, the strategy of Metaplanet and the capital side has attracted the attention of the market. Whether it can replicate the success of the micro-strategy model of Western companies in Asia requires further observation.

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