Japanese investment company Metaplanet today announced that it is temporarily pausing its stock acquisition rights. According to data from Coingecko, the firm currently holds 30,823 BTC on its balance sheet.
For the uninitiated, Moving Strike Warrants are financial instruments that give investors the right, but not the obligation, to buy or sell a company’s stock at a strike price that adjusts over time, usually based on the stock’s market price or other metrics.
Today’s announcement means that Metaplanet is essentially temporarily halting the sale of common stock to fund additional BTC purchases. Seeing the company’s stock’s recent performance, this should hardly come as a surprise.
Metaplanet’s shares have collapsed a massive 70% from their June highs. The following chart shows how Metaplanet’s stock is down more than 22% over the past month, trading at $550 at the time of writing.
Besides the depressed price action, Metaplanet’s valuation now stands at 1.05x Net Asset Value (NAV), the lowest reading since the firm launched its Bitcoin treasury strategy. Metaplanet’s total share value is now just slightly above the total value of BTC it holds.
The decision to temporarily halt additional share sale is likely taken to avoid further dilution of shareholders’ value. The seemingly incongruent behavior between rising BTC price and falling Metaplanet stock is not out of the ordinary.
For instance, Michael Saylor-led Strategy – despite being the largest public company in terms of BTC held on its balance sheet – has had to struggle over the past few months. MSTR shares have tumbled over 4.5% over the past month.
That said, Metaplanet reiterated that it remains committed to buying more BTC in the future. In its official announcement, the company said:
We remain committed to our mission of expanding Bitcoin holdings and maximizing BTC Yield for the benefit of our shareholders. In support of this mission, we are also developing new financial instruments and advancing the sophistication of our capital policy.
