How MicroStrategy’s Bitcoin Strategy Inspired Japan’s MetaPlanet

Since the Chief Executive Officer of MicroStrategy, Michael Saylor, took the bitcoin path, making it the principal reserve asset of the company, he became one of the leading voices in the Bitcoin community, and the main proponent of bitcoin for corporations. Now, a Japanese company called MetaPlanet is taking the same way.

I spoke with the bitcoin strategy leader, Dylan LeClair to fully understand this approach. Saylor’s MicroStrategy probed that it works, but replicating that success could be tricky. “Metaplanet’s decision to adopt a bitcoin standard was a rational response to the current economic climate, both in Japan and globally,” LeClair told me in an interview through email.

Economic Challenges Drive Bitcoin Adoption at MicroStrategy

The economic context and the inflationary environment were among the reasons Saylor argued at the start of his bitcoin journey in 2020. MicroStrategy began accumulating Bitcoin in August 2020. The company made headlines by announcing its first purchase of 21,454 BTC, valued at approximately $250 million at the time, as CoinDesk reported.

That initial acquisition was precisely positioned as a strategic hedge against inflation, marking MicroStrategy as one of the first major publicly traded companies to add Bitcoin to its balance sheet. Since then, MicroStrategy, led by CEO Michael Saylor, has consistently bought Bitcoin. The company sits on 252,220 BTC according to Bitcoin Treasuries numbers. MetaPlanet is taking the example.

“It’s evident that sovereign debt levels, relative to GDP, have reached unsustainable heights. This debt is unlikely to be repaid in real terms without prolonged financial repression—essentially, a period where inflation exceeds interest rates becomes the primary strategy for policymakers,” Dylan argued.

MetaPlanet’s Strategic Entry into Bitcoin: Is It Too Late?

But is it too late to adopt this approach? The competition is more extensive than when MicroStrategy took this path. As of late October 2024, U.S.-based Bitcoin ETFs hold over 1 million BTC, marking a significant accumulation milestone.

Recent estimates place their combined holdings at approximately 1.04 million BTC, representing around 5.26% of the total Bitcoin supply. Notably, BlackRock’s iShares Bitcoin Trust is the largest single holder among these ETFs, with significant contributions also coming from Grayscale’s Bitcoin Trust, ARK, and other newly approved spot ETFs.

“Far from believing that it’s ‘too late’ to adopt bitcoin, Metaplanet firmly believes we are still in the early stages of bitcoin’s institutional adoption and acceptance. Our timing is strategic, and we believe that embracing bitcoin now positions us well for the long term,” LeClair detailed.

MetaPlanet’s Bitcoin Acquisition Strategy: A Japanese Perspective

MetaPlanet’s approach, inspired by MicroStrategy, involves various financing mechanisms, including ordinary bonds, exercised warrants, and a ¥10 billion (~$70 million) stock acquisition rights issue. “Our focus is on the metric of ‘bitcoin per share’ (BTC/share), which we expect to grow by over 50%,” LeClair explained.

MetaPlanet strictly adheres to Japan’s regulations in its Bitcoin strategy. In a recent ¥10 billion stock rights issuance, LeClair noted that “¥8.5 billion of the funds raised would be allocated to acquiring more Bitcoin.”

The Tokyo Stock Exchange raised some questions explicitly looking for the benefits for shareholders. This questioning allowed the company to address its playbook fully. “Beyond being a store of value, bitcoin can also serve as collateral, facilitate trade, and generate income through futures and options markets. Our objective is to continue increasing both our aggregate bitcoin holdings and BTC/share for our shareholders,” LeClair declared.

For secure Bitcoin custody, MetaPlanet collaborates with institutional custodians in Japan. “As a public company, custody management complexity is high, so transparency is crucial,” LeClair said, noting their partnership with Hoseki to provide reserve proof for their holdings.

MetaPlanet’s Vision: Driving Corporate Bitcoin Adoption

This Japanese company aims to lead by example, advocating for Bitcoin as a corporate reserve asset in Japan and globally. “We expect more companies will adopt Bitcoin as a reserve asset, although adoption scale and scope will vary,” LeClair stated.

MicroStrategy’s success in adopting Bitcoin has driven its stock to new heights, making it one of the top-performing stocks in 2024. As of October, MSTR surged approximately 552% year-to-date, reaching a record high of $212, significantly outpacing the S&P 500 and other major tech stocks.

MetaPlanet now holds 1018.17, a base valued at five times its previous market capitalization before adopting this strategic shift.