Metaplanet Overhauls Capital Structure to Fuel Major Bitcoin Acquisition Drive

Metaplanet JP3481200008

In a decisive move to cement its position as a dedicated Bitcoin treasury company, Metaplanet has secured shareholder approval for a comprehensive capital restructuring. The measures, passed at an extraordinary general meeting on December 22, are designed to provide the financial foundation for a significant expansion of its cryptocurrency holdings, with an ambitious target to massively grow its Bitcoin position by the end of 2027.

All five proposals presented by management received strong backing from investors. CEO Simon Gerovich noted clear majorities were achieved for every item on the agenda. The approved resolutions form a multi-pronged strategy to enable future growth.

Central to the plan is a shift in focus from direct Bitcoin purchases to balance sheet optimization. The company has not reported a new Bitcoin acquisition since October 1. This pause coincided with a period where its Market Net Asset Value (MNAV) briefly fell below 1.0, meaning its shares traded at a discount to the value of its Bitcoin reserves. In such conditions, the firm identified share buybacks as a more efficient method to increase Bitcoin holdings per share than purchasing coins directly on the open market.

Key Components of the Capital Restructuring

The approved measures include several technical but crucial changes to the company’s capital framework:

• The conversion of subscribed capital and reserves into "other capital reserves."
• A doubling of the authorized number of Class A and Class B preferred shares to 555 million each.
• A restructuring of Class A preferred shares under the MARS (Metaplanet Adjustable Rate Security) model, featuring variable monthly interest dividends.
• The introduction of quarterly dividends for Class B preferred shares, coupled with a ten-year issuer call option at 130% of the issue price.
• Authorization to issue Class B preferred shares to foreign institutional investors.

Dylan LeClair, Director of Bitcoin Strategy, confirmed on platform X that these changes effectively double the board's capacity to issue A and B preferred shares.

Financing a Path to 210,000 BTC

Metaplanet currently holds 30,823 BTC, ranking it among the world's seven largest publicly traded corporate holders of the cryptocurrency. To fund its aggressive accumulation strategy, which targets a staggering 210,000 BTC (approximately 1% of the total Bitcoin supply), the company has prepared substantial financing tools. These include a $100 million loan secured by existing Bitcoin holdings and a separate $500 million credit line earmarked specifically for a share repurchase program. This strategy deliberately positions Metaplanet as an "Asian MicroStrategy."

Preferred Shares: A Novel Tool for a Bitcoin Treasury

A distinctive aspect of Metaplanet’s plan is the use of preferred shares as Bitcoin-collateralized yield products—a rare feature in the corporate Bitcoin treasury space. These instruments are designed to finance further Bitcoin accumulation without causing immediate, significant dilution for common shareholders.

To mitigate volatility risk, the company will cap the volume of issued preferred shares at a maximum of 25% of its Bitcoin net assets. This safeguard aims to prevent a sharp decline in Bitcoin's price from excessively straining the capital structure. The structure is also a calculated move to tap into Japan's vast pool of private wealth, estimated at about ¥7.5 trillion, while domestic yields remain near 0.5%. Metaplanet is marketing these shares as a Bitcoin-backed interest-bearing alternative for investors seeking options beyond traditional low-yield products.

Broadening the Investor Base

Further facilitating international investment, Metaplanet launched a Sponsored Level I American Depositary Receipt (ADR) program on December 19. The securities trade under the ticker MPJPY in the US over-the-counter market, making it easier for foreign institutional investors to gain exposure and helping to diversify the shareholder base beyond Japan.

Navigating a Challenging Landscape for Crypto Treasuries

Despite strong shareholder support, the environment for companies maintaining large crypto treasuries remains demanding. Many such firms currently trade at a discount to the value of their digital assets. The persistent threat of another "crypto winter" continues to fuel debate about the long-term sustainability of these business models.

Nevertheless, Japanese corporate Bitcoin accumulation continues. With this capital structure reform, Metaplanet is securing additional financial flexibility to pursue its accumulation strategy, aiming to manage dilution effects through preferred share issuance rather than the creation of new common stock.