Japanese bitcoin treasury company Metaplanet has unveiled a continuous bond issuance program dubbed BitBonds, completing its first sale with four privately placed series worth approximately 200 million yen, or $1.3 million. The unsecured senior bonds mature in roughly three years and carry annual interest rates of 4% to 4.3%.
The announcement comes on the same day that CEO Simon Gerovich denied speculation that Metaplanet had sold Bitcoin, clarifying that a 5,014 BTC movement was a routine custody transfer and that holdings remain at 43,000 BTC.
A New Funding Channel
BitBonds gives Metaplanet a new fixed-rate funding channel alongside shares and equity-linked securities. The company said future issuance will depend on funding needs, market conditions, and investor demand, with the eventual possibility of registered public offerings.
Unlike Metaplanet shares, which tend to reflect changes in the value of its Bitcoin holdings, the bonds offer fixed interest and principal repayment based on the company's overall creditworthiness. This creates a different risk profile for investors who want exposure to Metaplanet without the volatility of equity tied to Bitcoin's price.
The Risk Profile
However, the bonds are unsecured, unrated, and not principal-protected. The issuer's financial position remains heavily exposed to Bitcoin price swings, meaning that bondholders are indirectly exposed to the performance of Metaplanet's Bitcoin-heavy balance sheet. The bonds also carry transfer restrictions, and liquidity before maturity is not guaranteed.
These risks are significant. Metaplanet's Bitcoin holdings, acquired at an estimated average price of approximately $96,191, sit well below their cost basis with Bitcoin trading near $63,500. If the company were to face financial difficulties, bondholders would have no collateral to claim.
Distributed Through Metaplanet Securities
The inaugural securities were distributed through Metaplanet's wholly owned securities subsidiary to individuals and companies under Japan's small-number private placement rules. This marks the firm's broader push into Japan's yen-denominated credit market, leveraging its securities arm to reach investors directly.
The use of private placement rules limits the number of investors who can participate, but it also reduces regulatory friction. If Metaplanet eventually pursues registered public offerings, the potential investor base would expand significantly, potentially creating a new category of Bitcoin-backed debt instruments.
Part of a Broader Strategy
BitBonds is the latest in a series of financial innovations from Metaplanet. The company has been building businesses around its Bitcoin holdings, including Bitcoin-backed financing and securities operations. The bond program adds a debt instrument to a funding mix that already includes common stock, equity-linked securities, and preferred shares.
Metaplanet shares closed 0.9% higher at 223 yen ($1.40) on Thursday, suggesting that the market welcomed the diversification of funding channels despite the relatively small initial issuance size.
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