Japanese investment firm MetaPlanet has announced a bold new funding strategy called MARS that copies MicroStrategy’s successful approach to raising money for Bitcoin purchases.
The plan comes as the company holds over 30,000 Bitcoin worth $2.7 billion but faces mounting losses as crypto prices decline.
What is the MARS Plan?
MARS stands for “MetaPlanet Acquisition and Reserve Strategy.” It creates a new type of stock that sits at the top of the company’s ownership structure. CEO Simon Gerovich revealed the plan at the Bitcoin for Corporations Symposium alongside MicroStrategy’s Michael Saylor.
The MARS shares work differently from regular stock. They pay monthly dividends that change based on how the stock price performs. When the stock trades below its target price, dividend payments increase. When it trades above target, dividends decrease. This design aims to smooth out price swings while giving investors steady income.
Source: @BTCtreasuries
Unlike regular shares, MARS stockholders cannot convert their holdings into common stock. They also get paid before other shareholders if the company faces financial trouble. The structure prevents existing shareholders from losing value when new shares are issued.
Two-Tier System: MARS and MERCURY
MetaPlanet designed a dual approach using two different share classes. MARS represents the senior level, while MERCURY forms the second tier.
The company plans to raise ¥21.25 billion (about $150 million) through MERCURY shares. These Class B preferred shares pay a fixed 4.9% annual dividend and can be converted to regular stock at ¥1,000 per share.
MERCURY sits below MARS but above common stock in the company hierarchy. It offers both steady income and potential upside if Bitcoin prices rise. The shares target institutional investors through a private placement deal.
Critical Shareholder Vote Scheduled
MetaPlanet shareholders will vote on the new capital structure at an extraordinary general meeting scheduled for later in December 2024. The company announced this timeline during the Bitcoin for Corporations Symposium, where CEO Simon Gerovich appeared alongside MicroStrategy’s Michael Saylor.
The company previously outlined the MERCURY share structure, but both the broader restructuring and MERCURY issuance need shareholder approval before moving forward. Management canceled previous fundraising plans to focus on this preferred share approach.
Financial Position and Market Challenges
MetaPlanet currently holds 30,823 Bitcoin purchased at an average price of $108,070 per coin. With Bitcoin trading below that level, the company faces unrealized losses of roughly $636 million.
The timing proves challenging as corporate Bitcoin treasury companies struggle. Digital asset treasury inflows dropped to $1.32 billion in November 2024, the lowest monthly total of the year. MicroStrategy shares fell over 35% in November, while MetaPlanet stock dropped more than 20% as Bitcoin declined from October highs.
MetaPlanet’s market value now sits below the worth of its Bitcoin holdings. The company trades at a market-to-net asset value ratio of 0.96, meaning investors value it at less than its cryptocurrency assets. Management believes the new share structure can fix this problem by separating long-term investors from short-term traders.
Following MicroStrategy’s Proven Model
The MARS plan directly copies MicroStrategy’s successful preferred stock approach. MicroStrategy has used similar structures to fund aggressive Bitcoin purchases, becoming the largest corporate Bitcoin holder with over 400,000 Bitcoin as of late 2024.
MetaPlanet becomes the third company to adopt this preferred share model, joining MicroStrategy and other Bitcoin treasury firms. The approach helps these companies raise money without diluting existing shareholders or taking on traditional debt.
The company also secured a $130 million loan backed by its Bitcoin holdings in late November. This gives additional flexibility while the preferred share program awaits approval.
The Road Ahead: Ambitious Bitcoin Goals
MetaPlanet aims to become one of the world’s largest corporate Bitcoin holders. Current targets include 30,000 Bitcoin by end of 2025, 100,000 by 2026, and 210,000 by 2027. Reaching the final goal would represent about 1% of Bitcoin’s total supply.
The company transformed from a struggling hotel operator during COVID-19 into Japan’s leading Bitcoin treasury firm. It started accumulating Bitcoin in April 2024 and now ranks as the fourth-largest corporate holder globally.
Management plans to allocate roughly ¥15 billion from the new capital toward additional Bitcoin purchases. The remainder will support income-generating Bitcoin strategies and pay off existing bonds. Executives view market downturns as buying opportunities rather than reasons to slow accumulation.
Bottom Line: High Stakes Bitcoin Bet
MetaPlanet’s MARS plan represents a critical test for corporate Bitcoin strategies during challenging market conditions. The upcoming shareholder vote will determine whether investors support the complex financing structure needed to continue aggressive Bitcoin buying. Success could establish a template for other Asian companies, while failure might signal limits to the corporate Bitcoin treasury model when market conditions deteriorate.