Metaplanet's $3.8 Billion Preferred Share Gambit: Can It Sustain Bitcoin Accumulation at Scale?

Japanese crypto firm Metaplanet is facing a critical juncture. After a stunning 400% surge early this year, the company’s stock has lost more than half its value in just 90 days—a dramatic reversal that’s forcing leadership to pivot its capital-raising strategy dramatically. With Bitcoin trading near $88.24K, the firm is now pushing an aggressive financial maneuver to keep its Bitcoin accumulation engine running.

The Financing Crisis Behind the Curtain

Metaplanet’s original growth engine—a sophisticated capital arrangement with Evo Fund based on moving strike warrants—has essentially ceased functioning. This “flywheel” structure previously allowed the firm to access capital with minimal friction: Evo would purchase shares at favorable prices when Metaplanet’s stock climbed, then sell them back at profits, with the gains flowing directly into Bitcoin purchases. The model was elegant when equity prices soared.

But equity collapse changed everything. Once the stock tumbled, Evo lost all incentive to exercise those warrants. The result? A dramatic slowdown in capital inflow. Between June 30 and now, Metaplanet’s Bitcoin holdings grew less than 50%, a sharp deceleration from the 160% expansion achieved in the two months prior.

The company’s Bitcoin premium—the valuation spread between market capitalization and actual Bitcoin holdings—has compressed dramatically. In June, Metaplanet’s market cap stood at eight times its BTC stash value. Today, that ratio has collapsed to barely 2x. As equity sells deeper below Bitcoin holdings, traditional share issuance becomes punitive to existing shareholders.

The $3.8 Billion Authorization: Strategic Repositioning

Entering this void, Metaplanet is pursuing a structural workaround. At an upcoming Tokyo shareholder meeting, investors will vote on authorizing 555 million preferred shares with potential capital raising capacity of ¥555 billion ($3.8 billion). The company already secured $884 million through overseas share sales, but management views the preferred securities as the long-term solution.

These preferred shares carry a maximum 6% dividend, capped at 25% of the company’s Bitcoin reserves. The instrument isn’t new—Michael Saylor’s Strategy Inc. has deployed similar structures extensively in the U.S. to fuel aggressive Bitcoin accumulation. But for Japanese public markets, this represents relatively untested territory.

President Simon Gerovich, the former Goldman Sachs trader who steered Metaplanet from hotel management into crypto accumulation, has explicitly framed the preferred shares as a “defensive mechanism.” His logic is straightforward: if common equity continues depreciating toward Bitcoin’s underlying value, diluting existing shareholders becomes economically destructive. Preferred securities sidestep this friction by creating a separate capital tier with different risk-return profiles.

Ambition Meets Execution Risk

The strategic goal remains audacious: 100,000 Bitcoin by end of 2026, doubled to 200,000 by 2027. At current valuations, that target represents hundreds of billions in capital deployment. For context, there are now over 170 public companies globally holding Bitcoin, with combined positions valued above $111 billion. Strategy Inc. dominates with approximately 630,000 BTC. Metaplanet currently ranks seventh with 18,991 tokens worth roughly $2.1 billion.

The math is unforgiving. Maintaining such accumulation velocity requires either consistent equity access or alternative capital sources. With the flywheel mechanism neutered, Metaplanet is betting that preferred share authorization preserves capital access when common equity valuations become economically irrational for new issuance.

Between September 3 and September 30, the company has suspended all warrant exercises with Evo, clearing administrative space for the preferred share authorization vote. Industry observers view this freeze as essential preparation for the capital structure reconfiguration.

When Does the Bitcoin Buying Spree End?

The unspoken question haunting this strategy: infinite capital doesn’t exist. As valuations compress and equity markets reassess Bitcoin proxy valuations, aggressive accumulation programs face inevitable constraints. The company’s ability to maintain exponential Bitcoin buying depends on capital availability—a resource that market cycles inevitably restrict.

Metaplanet’s bet hinges on preferred shares becoming that alternative capital source, allowing equity dilution to be managed through a separate security class. Whether Japanese shareholders validate this approach—and whether capital markets continue accommodating such issuance—will determine whether the firm’s Bitcoin ambitions survive this inflection point.