Metaplanet secures $6.8 million loan to buy bitcoin
Date: 2024-08-09 Author: Gabriel Deangelo Categories: BUSINESS
Metaplanet, a Japanese investment adviser, announced that it has secured a 1 billion yen (approximately $6.8 million) loan to buy bitcoin. In a statement on its website, the company noted that the money was borrowed from a shareholder, British Virgin Islands-registered MMXX Ventures, and is intended entirely for the purchase of cryptocurrency. The loan term is six months with an annual interest rate of 0.1%.
In May, Metaplanet announced plans to use bitcoin as a reserve asset to hedge against volatility in the Japanese yen. At the start of July, the company held 161.3 BTC, which was valued at $9.2 million at the time.
The strategy is similar to that of US-based MicroStrategy, which has been actively buying bitcoin for four years and currently holds more than 226,000 BTC, representing more than 1% of all bitcoins in existence.
Amid news of the loan and bitcoin purchase, Metaplanet shares closed at 893 yen ($6.10) on Thursday, up 20% from the previous day. The Japanese stock market is recovering from last week, when the Bank of Japan’s interest rate hike triggered a significant sell-off in the stock.
The bitcoin market has seen significant gains in the past year, with its price increasing 28% in October, part of a broader rally in cryptocurrencies. Recent events, such as the $1 billion Bitcoin withdrawal, have also contributed to the market’s optimism.
In addition, the correlation between Bitcoin price and volatility has turned negative again, which has attracted the attention of traders monitoring the liquidation of FTX assets. At the same time, interest in NFTs continues to grow, as demonstrated by the recent increase in sales of digital assets related to Donald Trump.
Metaplanet's strategy of using Bitcoin as a reserve asset is a significant step for the Japanese company. It not only aims to protect against yen fluctuations, but also opens up new opportunities in the rapidly evolving world of cryptocurrencies.
