Shares of Metaplanet, a Japanese firm focused on Bitcoin trading and investment, have plummeted to levels near the value of its cryptocurrency holdings following a massive $625 million impairment loss. The company reported a net loss of 95 billion yen ($625 million) in fiscal year 2025, driven primarily by a 102.2 billion yen write-down of its Bitcoin reserves under Japanese accounting rules.

Operational Strength Contrasts With Accounting Loss

Despite the accounting loss, Metaplanet’s core operations showed strong performance. Revenue surged by 738% to 8.9 billion yen, and operating profit jumped 1,694% to 6.3 billion yen. This was largely fueled by its ‘Bitcoin Income Business,’ which generated 7.98 billion yen from options trading on its Bitcoin holdings—a sharp increase from 691 million yen the previous year.

According to the company’s February 16 financial report, the Bitcoin Income Business accounted for much of the revenue growth. The segment’s premium income in the fiscal year was more than 10 times higher than the prior year, despite the broader market turmoil affecting cryptocurrency prices.

Shareholder Concerns and Management Response

Following the release of the results, social media users and investors raised concerns about the company’s strategy, alleging it had bought Bitcoin at peak prices and taken out loans against its holdings without sufficient transparency. CEO Simon Gerovich addressed these claims on February 20, stating that all Bitcoin wallet addresses are publicly visible through a live dashboard for shareholders.

Gerovich emphasized that the reported losses were due to mark-to-market accounting fluctuations, not the sale of assets. ‘The impairment is an unrealized loss on assets we continue to hold,’ he said, adding that the company remains committed to its long-term Bitcoin accumulation strategy.

Investment bank Cantor Fitzgerald revised its price target for Metaplanet’s shares on February 18, cutting it from $6 to $3. However, the firm retained its ‘Overweight’ rating, citing the company’s continued Bitcoin accumulation. By the end of 2025, Metaplanet’s Bitcoin holdings had grown to 35,102 BTC, up from 1,762 BTC a year earlier.

Capital-Raising Mechanism Falters

A key challenge for Metaplanet is the failure of its primary capital-raising mechanism. The company’s strategy of issuing moving-strike warrants to the EVO Fund is only viable in bull markets. With the share price trading far below exercise prices and the market-value-to-net-asset-value (mNAV) ratio near 1x, this funding source has effectively dried up.

In response, Metaplanet has shifted to issuing preferred shares. Its Class B ‘MERCURY’ shares, offering a fixed 4.9% dividend, raised 21.2 billion yen. Another Class A instrument, ‘MARS,’ provides a variable dividend between 1% and 8%. In Japan’s low-interest-rate environment, where the benchmark rate is 0.75%, these yields remain attractive to domestic investors.

Metaplanet’s management forecasts an 80% revenue increase to 16 billion yen in fiscal year 2026, with operating profit expected to reach 11.4 billion yen. The Bitcoin income segment alone generated 4.3 billion yen in the fourth quarter, an annualized run-rate that exceeds the full-year forecast.

The company remains committed to its long-term Bitcoin accumulation goals. It aims to hold 100,000 BTC by the end of 2026 and 210,000 BTC by 2027, which would represent about one percent of the total Bitcoin supply. As of February 20, the shares closed at 319 yen in Tokyo, a sharp decline from their 52-week high of 1,930 yen.

With the company’s shares trading near the value of its Bitcoin holdings, the situation has raised questions about its future strategy and investor confidence. Analysts are closely watching whether the company can stabilize its share price and revive its capital-raising mechanisms in the current market environment.