In today's announcement, Japanese company Metaplanet revealed plans to increase its Bitcoin (BTC) holdings through the issuance of bonds worth $11.3 million to raise funds for purchases.
Metaplanet will increase its BTC holdings through the issuance of bonds.
The Tokyo-listed company announced on November 18 that its board has approved the secured sale of debt valued at 1.75 billion yen (approximately $11.5 million). The bonds will mature in one year, expiring on November 17, 2025, with an annual interest rate of 0.36%.
The proceeds from the bond issuance will be used solely for the purchase of BTC. It is worth noting that Metaplanet already holds 1,018 BTC on its balance sheet.
Metaplanet's latest BTC acquisition announcement is often referred to as 'MicroStrategy of Asia.' Just a week ago, the American business intelligence company MicroStrategy purchased 27,200 BTC, worth approximately $2.03 billion at current market prices.
Metaplanet began acquiring BTC in April as a strategic treasury reserve asset. The company announced that it will adopt a 'Bitcoin first, Bitcoin only' approach, which echoes MicroStrategy's BTC investment strategy.
Since April, this early-stage investment company has steadily expanded its Bitcoin portfolio. For example, the company purchased an additional 20.195 BTC in June, valued at approximately $1.2 million.
It added another 38.464 BTC in September, valued at approximately $2 million. Recently, in October, the company announced it had purchased 156.78 BTC, bringing its total holdings over 1,000 BTC.
Despite announcing the bond issuance, Metaplanet's stock price showed little fluctuation. The company's stock price rose slightly by 0.81% at the close on Monday.
However, since the company began its Bitcoin acquisition strategy, its stock has experienced explosive growth. On April 4, 2024, Metaplanet's stock price was 190 yen ($1.23). Today, their trading price is 1,994 yen ($12.86), having risen nearly 950% in just over seven months.
Is the scarcity of Bitcoin supply pushing prices higher?
With the increasing demand from retail, institutional, and even sovereign sources, Bitcoin's limited supply could lead to a supply shock, potentially driving the price of the digital asset to unprecedented levels. Reminder: the total supply of BTC is designed to be 21 million units.
According to recent analysis by CryptoQuant analysts, BTC reserves on cryptocurrency trading platforms have fallen to their lowest levels in five years. The analyst also noted that an increasing number of investors are holding Bitcoin long-term to hedge against rising inflation and currency devaluation.
Similarly, a recent report indicates that the demand for BTC far exceeds its supply. This increasing supply-demand imbalance could lay the groundwork for the next significant price breakout for Bitcoin. As of the time of writing, BTC is trading at $90,909, having risen 0.1% in the past 24 hours.
