Is the price higher than Bitcoin? Experts explain why Metaplanet stocks carry a 5x premium.

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## Premium Price of Metaplanet

On the 27th, 10x Research, which researches the cryptocurrency market, announced an analysis of the stocks of the Japanese company Metaplanet, known for its Bitcoin (BTC) financial strategy.

Metaplanet is adopting a strategy of investing raised funds into Bitcoin, modeled after the U.S. company Strategy. The company's shares are attracting the attention of investors as an indirect investment vehicle with leverage into Bitcoin.

10x Research stated that the stock of Metaplanet is trading as if the spot price of Bitcoin in the market is $109,000, approximately 5 times that at $596,154.

Investors are noted to be paying a premium of 447% (more than 5 times).

Metaplanet announced on the 19th that it has purchased additional Bitcoin for 15.1 billion yen. The total acquisition amount is approximately 105.4 billion yen, and the number of holdings is now 7,800 BTC. The company is accelerating its plan to hold 21,000 BTC by 2026.

There are various opinions from experts regarding the premium on Metaplanet's stock price.

On the 16th, Marty Kendall of Microstrategist, a website providing information on the financial strategies of Strategy Company regarding Bitcoin, stated that the estimated fair price of Metaplanet's stock at the current time (before the additional purchase on the 19th) is 743 yen.

As a result of the additional Bitcoin purchases on the 19th, the company's stock price has risen to around 1,100 yen at the time of writing this article.

Mr. Kendall analyzed that Metaplanet is evaluated to be able to accumulate Bitcoin from investors faster than other companies, and as a result, the stock price is in a premium (overvalued) situation.

However, it was pointed out that fundraising through stock issuance in the market tends to lower stock prices and decreases the stock price to net asset value (mNAV).

On the other hand, it was continued that "value-increasing dilution" is being carried out by raising funds through stock dilution and additionally purchasing Bitcoin, which increases the Bitcoin value per share in the long term. It is stated that this balance is important.

The price-to-net asset value (mNAV) indicates the extent to which a company's stock price is trading at a premium or discount relative to its net asset value. Typically, if this is above 1, the stock price is considered to be at a premium (overvalued), and if it is below 1, it is seen as being discounted.

Source: Microstrategist

Mr. Kendall plotted the BTC value per share and the stock price of Metaplanet on a logarithmic scale. By visually capturing the fundamentals of the company and the trend in its stock price, he argued that the estimated fair stock price as of the 16th was 743 yen.

Factors contributing to the significant rise in the stock price of Metaplanet over the past year include the company's strong belief in its Bitcoin strategy. Furthermore, it has been pointed out that in Japan, there is a high tax on cryptocurrencies such as Bitcoin compared to stocks, which poses a barrier to investing in physical Bitcoin.

In addition, Blockstream's founder Adam Back predicted at the end of April that Bitcoin would become mainstream in society. He stated that companies adopting a Bitcoin financial strategy are "engaging in arbitrage by leveraging the divergence between the future value of Bitcoin and the current value of fiat currency."

Additionally, cryptocurrency investor and YouTuber Joe Takayama analyzed on X on the 27th that "stocks of companies holding BTC are being bought as pseudo-ETFs" because Bitcoin spot ETFs are unapproved in Japan.

It can be argued that this is a temporary phenomenon resulting from regulatory distortions.

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The content is for reference only, not a solicitation or offer. No investment, tax, or legal advice provided. See Disclaimer for more risks disclosure.
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