The Tokyo Stock Exchange-listed firm doubled down on its accumulation strategy as shares traded more than 2% higher following the announcement.
Bitcoin News
Metaplanet has announced plans to use its Bitcoin holdings as collateral to secure a $130 million loan for additional Bitcoin acquisitions. The Tokyo Stock Exchange-listed firm doubled down on its accumulation strategy as shares traded more than 2% higher following the announcement.
The loan brings total borrowing under Metaplanet's $500 million Bitcoin-backed credit facility to $230 million. The company executed the new borrowing on Nov. 21, with the lender not disclosed at the counterparty's request.
Interest on the loan is calculated by reference to a U.S. dollar interest rate plus a spread. The term renews automatically on a daily basis, and funds can be repaid at the company's discretion.
Metaplanet stated that funds allocated to the Bitcoin Income Generation business will be used as collateral for selling Bitcoin options to earn premium income. The firm now holds 30,823 Bitcoin worth approximately $2.7 billion at current prices.
The company, dubbed Asia's Strategy by some investors, pivoted from its core hotel and technology business to start buying Bitcoin in 2024. Metaplanet aims to acquire 210,000 Bitcoin, or 1% of the overall supply, by 2027.
The borrowing is secured by the company's Bitcoin holdings. As of Oct. 31, Metaplanet's Bitcoin reserves were valued at roughly $3.5 billion, providing significant collateral headroom even during severe market volatility. Management reiterated that it draws only within conservative collateral buffers.
The loan comes at a time when crypto prices have taken a hit and digital asset treasuries face pressure. A plunge this quarter in digital asset prices has highlighted concerns among skeptics of the treasury strategy pioneered by Strategy in 2020.
Bitcoin's price crashed last week and is now sitting 30% below its October record of $126,080. The asset recently traded near $87,516, down 1% over a 24-hour period after rebounding from a low of about $81,000 last week.
Metaplanet shares rose 2.24% to 365 yen following the announcement but remain more than 80% below June's record high. Year-to-date, Metaplanet shares have risen by nearly 5%, showing resilience compared to other digital asset treasuries that have suffered steeper declines as the broader cryptocurrency market corrects from previous highs.
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