Japanese investment firm Metaplanet has secured a $6.8 million (1 billion Japanese yen) loan from shareholder MMXX Ventures to expand its Bitcoin holdings. The loan, with a 0.1% annual interest rate and a six-month term starting August 8, will be repaid in a lump sum.
With this loan, Metaplanet plans to purchase an additional 118.5 Bitcoins at current market prices. This move comes shortly after the firm revealed plans to raise $70 million through a stock rights offering, with $58 million earmarked for Bitcoin investments.
Metaplanet’s strategy aligns with similar moves by MicroStrategy, aiming to use Bitcoin as a hedge against Japan’s increasing debt and the weakening yen.
CEO Simon Gerovich highlighted at the Bitcoin 2024 conference in late July that the firm was previously in poor financial health but saw Bitcoin as a key asset to improve its long-term prospects.
To date, Metaplanet has acquired 246 Bitcoin worth $13.95 million through seven separate purchases. The firm’s average purchase price is $65,145, reflecting a 12.8% decline since its initial Bitcoin investment on April 23.
Despite this drop, Metaplanet’s stock price has surged by 290% since it announced its Bitcoin strategy on April 9, trading at $4.39 (643 Japanese yen). However, it has fallen from a year-high of $20.50 (3,000 Japanese yen) recorded on July 24, partly due to Bitcoin’s 10% drop during the industry’s “Black Monday” on August 5.
Metaplanet’s strategic loan to boost Bitcoin holdings underscores a bold bet on digital assets as a hedge against economic instability. This move aligns with growing trends among investment firms to leverage Bitcoin for long-term financial stability.
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