News, Price Analysis

Metaplanet Acquires 20.20 More Bitcoins Amid Japan’s Economic Uncertainty

With Japan’s cloudy financial outlook, publicly-traded company Metaplanet is boldly moving. So far they’ve invested a whopping 1 billion yen (about $6.26 million) in Bitcoin, ditching low-interest bonds for the world’s most famous cryptocurrency, using proceeds from its second issuance of ordinary bonds, which carry an annual interest rate of 0.5% and mature in June 2025. With its additional Bitcoin purchase of ¥200 million, as of now, the firm has a total of 161.2677 Bitcoins in its account. 

Savvy strategy or a risky gamble? Read on and decide for yourself.

Why is Japan Turning to Bitcoin?

Metaplanet’s decision is part of a broader strategy to manage risks related to Japan’s high debt and the resulting yen volatility. In 2023, Japan’s net debt to GDP ratio was the highest among G7 countries, at around 159%. 

Recent Transactions 

Continuing their buying spree, Japan’s Metaplanet has yet again acquired approximately 20.20 more Bitcoin for ¥200 million, averaging ¥9,903,441 per BTC. As of July 1, Metaplanet’s Bitcoin holdings total around 161.27 BTC, purchased for ¥1.65 billion at an average price of ¥10,231,438 per $BTC. This marks the Fourth substantial Bitcoin purchase by the company in just seven weeks, and its share price has increased nearly fivefold since first announcing its Bitcoin strategy in April, proving the effectiveness of its approach.

Planning for the Future

Similar to Microstrategy, by holding Bitcoin as a reserve asset, Metaplanet aims to reduce its exposure to the yen and protect itself from Japan’s debt issues. The company also plans to raise an additional ¥935 million (about €5 million) through “Stock Acquisition Rights” to buy more Bitcoin, following the trend of U.S. companies investing in cryptocurrencies.

The increased adoption of Bitcoin by institutional investors has led to a notable decrease in BTC available on centralized exchanges. June was catastrophic for the entire crypto market, Bitcoin fell 17%. The global crypto market’s capitalization fell 10.27% from $2.53 trillion at the start of the month to $2.27 trillion by the end. However, as July began, Bitcoin started to show signs of recovery. The cryptocurrency has since surged by 4% within a day, currently trading at $63,360.

Despite this changing sentiment, large investors (whales) are accumulating Bitcoin, which often leads to price rebounds.

Japan’s Crypto Maneuver

However, Metaplanet’s move is not isolated; Sony’s acquisition of Amber Japan highlights the growing corporate interest in crypto within Japan’s tech sector. This trend suggests that big investors are looking for a valuable asset in the current global downturn.

Other companies are following Metaplanet’s crypto strategy. We’ll have to wait and watch if it helps the country or threatens the Yen.

SOURCE

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