Metaplanet’s Financial Advantage Over Other Digital Asset Treasury Companies
Metaplanet, a leading Bitcoin (BTC) treasury company, may have a significant financial edge over its competitors due to the structural weakness of the Japanese yen (JPY). According to BTC analyst and crypto treasury company investor Adam Livingston, Japan’s debt-to-gross-domestic-product ratio is approximately 250%, which continues to weaken the yen. The high debt level necessitates the printing of more yen to cover deficits, resulting in an even higher debt level and erosion of the yen’s value.
When measured in US dollar terms, BTC has appreciated by about 1,159% since 2020. However, when measured against the Japanese yen, BTC has gained a staggering 1,704% over the same period. This disparity is illustrated in the chart below, which compares Bitcoin’s cumulative returns since 2020 in both USD and JPY.
Livingston notes that the weaker yen provides Metaplanet with cheaper access to financing, as its liabilities are denominated in a fiat currency that is weaker than the US dollar. He explains, “Every coupon Metaplanet pays is in a currency that has been losing value relative to both BTC and USD, so the real, BTC-denominated, cost of that 4.9% coupon keeps shrinking.” In contrast, other companies, such as Strategy, pay their coupons in stronger units, resulting in a slower erosion of their liabilities.
Metaplanet’s Position in the Market
Despite the broad downturn in crypto treasury companies, Metaplanet has become the 4th largest BTC treasury company, holding 35,102 BTC in its reserve. According to data from BitcoinTreasuries, this puts Metaplanet ahead of other notable companies in the sector. The company’s most recent BTC purchase occurred on Tuesday, with the acquisition of 4,279 BTC for approximately $451 million.
However, Metaplanet’s stock price has fallen in line with the rest of the crypto treasury sector, including Strategy, BitMine, and Nakamoto. This decline is part of a broader trend, as crypto markets continue to struggle in the aftermath of the historic crash in October.
For more information on Metaplanet and the crypto treasury sector, visit the original source link: https://cointelegraph.com/news/metaplanet-edge-us-dats-jpy-weakness?utm_source=rss_feed&utm_medium=rss_tag_bitcoin&utm_campaign=rss_partner_inbound
