Metaplanet Earns Over 1M dollars in Bitcoin by selling put options
Japanese investment company Metaplanet has made 23.972, or approximately $1.46 million at the current market prices, by collecting premiums and selling bitcoin options to increase its holdings.
Metaplanet noted in a statement on Thursday that it has entered into a bitcoin options transaction with QCP Capital.
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â Simon Gerovich (@gerovich) October 3, 2024
Metaplanet strategy increases its Bitcoin reserves
According to Metaplanet, it is able to boost its Bitcoin holdings if the market price drops below the strike price of $62,000 per BTC at maturity by selling 223 BTC put options. The date of maturity is fixed for December 27, 2024.
The investment firm elaborated on the transaction's financial mechanisms, stating that the put option sale was entirely secured by cash. This required $13.8 million in margin collateral, which came from recently raised funds. The strategy reduces financial risk.
The company increased its total assets to 530.717 bitcoin, or roughly $32.4 million, by obtaining 23.972 BTC. The $13.8 million in margin collateral needed for the put options strategy came from new capital obtained from the sale of the company's stock acquisition rights. This indicates that the strategy was funded by different sources and is designed to potentially grow their Bitcoin holdings rather than to use or hedge their current holdings.
This approach strengthens the company's balance sheet and increases its bitcoin reserves, Metaplanet said in a statement. It also aligns with Metapalnet's ongoing financial strategy to solidify long-term bitcoin exposure and enhance the company's financial position, supporting its path toward profitability. The margin funds will be used to buy bitcoin, the company added.
Metaplanet profits from the volatility of Bitcoin
The CEO of Metaplanet, Simon Gerovich, stated that the volatility of bitcoin "creates opportunities for us to generate more bitcoin" in a post published on X on Thursday.
Gerovich explained that the bulk of the company's holdings will always be in bitcoin, but acknowledged that it makes sense to use some of them to generate income through options trading.
Metaplanet goes on a Bitcoin buying spree
The Tokyo-listed firm announced on Tuesday that it has acquired an extra 107.913 bitcoin, valued at approximately 1 billion yen or roughly $6.9 million.
Metaplanet increased the amount of Bitcoin it possessed by 38.464 BTC in the first few days of September, totaling 300 million yen, or roughly $2 million. These purchases demonstrate Metaplanet's dedication to utilizing Bitcoin as a tactical reserve asset and demonstrate the company's ongoing confidence in cryptocurrencies.
Bitcoin dropped 2.47% in the last day to trade at $60,271.98 as of this writing. Last week, it was above $66,000, according to CoinMarketCap.
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