As more and more listed companies use Bitcoin as an asset reserve, just buying Bitcoin is no longer enough! Japan's Metaplanet announced a Bitcoin option transaction with Singapore-based digital asset trading company QCP Capital. Metaplanet called it a "target buy" and emphasized that it is another way to obtain Bitcoin.
Selling Bitcoin Put Options Increases Profits
Metaplanet used the proceeds from the previous issuance of new shares as margin to sell 223 Bitcoin put contracts to QCP Capital under the following conditions:
Expiration date: 2024/12/27
Execution price: 62,000
Premium: 0.1075 BTC/per contract
If the Bitcoin market price falls below the execution price of $62,000 at expiration, Metaplanet will be obligated to purchase Bitcoin at the execution price. This strategy is in line with its goal of continuously increasing its Bitcoin holdings. And Metaplanet has set aside the necessary funds, so there is no additional financial risk compared to purchasing Bitcoin directly.
In addition, the nominal yield rate is 10.75%, and the corresponding premium amount is 214,549,400 yen, which translates into a breakeven price of approximately US$55,335, which is lower than the execution price of US$62,000.
If Bitcoin is higher than $62,000 on the expiration date, Metaplanet does not need to execute any transactions, which is equivalent to directly earning a premium of 23.972 BTC in total.
Metaplanet highlights this strategy as "target buying" and is another way to acquire Bitcoin. The purpose of the funds has not changed.
Metaplanet Already Owns 530 Bitcoins, Shares More Than Quadruple Year to Date
Metaplanet has been on a Bitcoin buying spree in recent months after announcing in May that it would begin adopting Bitcoin as its strategic reserve asset. On Tuesday, Metaplanet purchased an additional 107.913 Bitcoins, worth approximately 1 billion yen. There are currently 530.727 Bitcoins owned, with an average cost of 9,354,425 yen (approximately $63,635 USD).
Metaplanet shares closed at 966 yen on Thursday. It's up 408% year to date. In July, the price even rose to 3,000 yen.
This article Bitcoin asset reserve is further advanced, Metaplanet uses options to increase BTC returns first appeared on Chain News ABMedia.
