In a surprising turn of events, Metaplanet, a Japanese company that began as a budget hotel operator under the name Red Planet, has seen its stock soar by a staggering 90% in just two days. This dramatic rise comes after the company announced it was following in the footsteps of another tech firm, MicroStrategy, by adding Bitcoin (BTC) to its balance sheet.
The move signals a major shift for Metaplanet, which has pivoted from the hospitality industry to become a Web3 infrastructure provider. This new focus on the decentralized web includes a strategic investment of $6.56 million in Bitcoin, facilitated through a partnership with Sora Ventures and other prominent crypto investors.
Metaplanet’s decision to embrace Bitcoin appears to be multi-pronged. The company cited a desire to reduce its exposure to the Japanese yen, which has been weakened by years of low-interest rates. Bitcoin, with its limited supply and potential for long-term growth, is seen as a hedge against inflation and a way to bolster the company’s financial resilience.
There’s another layer to the strategy. By adding Bitcoin, Metaplanet is aiming to offer Japanese investors a more accessible way to gain exposure to the cryptocurrency market. Unlike directly buying and holding Bitcoin, which faces high taxes on realized gains in Japan, investing in Metaplanet allows for indirect crypto exposure through a publicly traded company potentially benefiting from a more favorable tax structure.
This move echoes the strategy of MicroStrategy, the US-based software company that became a frontrunner in corporate Bitcoin adoption back in 2020. Since then, MicroStrategy’s stock price has often mirrored fluctuations in Bitcoin’s value, reflecting investor sentiment towards the cryptocurrency market. It currently holds the title of the largest corporate owner of Bitcoin, according to bitcointreasuries.net.
Metaplanet’s decision has certainly captured the attention of investors, with its stock price experiencing a meteoric rise. However, it’s important to note that the long-term implications of this strategy remain to be seen. The price of Bitcoin, and by extension, Metaplanet’s stock, is inherently volatile. Whether this gamble on Bitcoin pays off for the former budget hotel chain turned Web3 player will be a story to watch unfold in the coming months and years.
