On Thursday, Asia’s MicroStrategy Metaplanet announced a significant Bitcoin options transaction that has caught the attention of investors and market analysts alike.
The company, known for its innovative approach to digital asset management, has successfully executed a sale of Bitcoin put options that not only generated substantial premium income but also positioned it for potential expansion of its Bitcoin holdings.Â
This strategic maneuver, conducted in partnership with Singapore-based QCP Capital, demonstrates Metaplanet’s commitment to leveraging sophisticated financial instruments within the volatile cryptocurrency market.
Metaplanet’s Bitcoin Put Options Sale
Metaplanet Inc. has made a significant move in the cryptocurrency market by engaging in a Bitcoin options transaction with QCP Capital, a Singapore-based digital asset trading firm. The company has sold 223 Bitcoin put options, generating a substantial premium and potentially increasing its Bitcoin holdings.
The transaction details reveal that the put options have a maturity date of December 27, 2024, with a strike price of 62,000 USD per Bitcoin. Each contract was sold for a premium of 0.1075 BTC, resulting in an aggregate premium of 23.972 BTC for Metaplanet. This deal offers an impressive nominal yield of 10.75% and an annual yield of 45.63%, showcasing the potential profitability of the strategy.
To secure this transaction, Metaplanet deposited 13,826,000 USD as margin collateral. The company clarified that these funds were sourced from the proceeds of their 11th stock acquisition rights exercise, maintaining transparency about the origin of the capital used for this venture.
The primary purpose behind this transaction is twofold. Firstly, it allows Metaplanet to capitalize on Bitcoin’s notorious volatility by generating premium income. Secondly, it provides an opportunity to increase the company’s Bitcoin holdings if the market price falls below the strike price at maturity. This approach aligns with Metaplanet’s long-term financial strategy to strengthen its Bitcoin exposure and improve its overall financial position.
Interestingly, Metaplanet views this options sale as a form of “target buy” for acquiring Bitcoin. The company plans to use the margin funds for purchasing Bitcoin, demonstrating their commitment to expanding their cryptocurrency portfolio. This strategy not only has the potential to enhance Metaplanet’s Bitcoin reserves but also reinforces its balance sheet, potentially supporting its path toward profitability.
As a result of this transaction, Metaplanet’s Bitcoin holdings have been updated. The company received 23.972 Bitcoin at an average purchase price of 8,950,000 yen per Bitcoin. This addition brings their total Bitcoin holdings to 530.717 Bitcoin, with an updated average purchase price of 9,354,425 yen per Bitcoin. The aggregated amount purchased now stands at 4.965 billion yen, representing a significant investment in the cryptocurrency.
Metaplanet’s Ongoing Bitcoin Acquisition and Market Impact
In a prior disclosure, Metaplanet’s Bitcoin acquisition had infused an additional 1 billion Yen for fresh Bitcoin purchases, bringing its total investment to 4.75 billion Yen. This move comes at a time when Bitcoin’s price stood at $63,657, down 1.32% with a market cap of $1.257 trillion. The announcement of these strategic moves has had a positive impact on Metaplanet’s stock price, which surged 3.63% to 1,027 levels.
While the stock shows an impressive 540% year-to-date gain, it remains 66% below its 2024 high. These developments coincide with Bitcoin’s strong performance in September, closing with 8% gains, its best September in a decade, despite failing to hold above the crucial $65,000 resistance level.