Japanese firm Metaplanet makes 23.9 BTC by selling 223 put options
Date: 2024-10-03 Author: Henry Casey Categories: BUSINESS
Japanese investment firm Metaplanet reported making 23.9 bitcoins (around $1.4 million) from selling 223 bitcoin put options to QCP Capital, a Singapore-based digital asset trader.
The company said it made a premium income of 0.1075 bitcoins per contract. Metaplanet explained that the deal allows the company to take advantage of bitcoin volatility by collecting a premium while maintaining full financial backing. Selling 223 put options also provides the opportunity to increase the number of bitcoins if the market price falls below the set strike price of $62,000 by the time the contract expires.
“This strategy not only strengthens our Bitcoin reserves, but also improves the company’s financial performance, which is consistent with our long-term strategy of increasing Bitcoin exposure and strengthening our balance sheet to continue to drive profitability,” Metaplanet added.
A put option gives the buyer the right (but not the obligation) to sell a certain amount of Bitcoin at a predetermined price (the strike price) before a certain expiration date of the contract. If the price of Bitcoin falls below the strike price by the expiration date, the buyer will typically exercise this right. In this case, the seller of the option is obligated to buy the Bitcoin from the holder at the agreed-upon price.
This week, Metaplanet also announced the purchase of an additional 107.9 Bitcoin worth 1 billion yen (about $7 million). In total, the company now owns 530.7 Bitcoin, which is valued at about 4.96 billion yen ($34 million).
