Metaplanet’s enterprise value dips below Bitcoin holdings for first time

Japanese bitcoin treasury firm Metaplanet's enterprise value has fallen below its bitcoin holdings, indicating it trades at a discount to its crypto reserves.

According to the company's official website, Metaplanet's mNAV — a multiple that expresses enterprise value relative to the net asset value of its bitcoin holdings — fell to 0.99 on Tuesday for the first time. Its mNAV is calculated as the company's market capitalization plus total debt, then divided by the net asset value of the bitcoin reserve.

Since pivoting to a bitcoin treasury strategy in April 2024, Metaplanet has actively accumulated bitcoin, recently making two large purchases totaling  over $600 million each. The company currently holds 30,823 BTC, worth over $3.45 billion at current rates. It is currently positioned as the world's fourth-largest public bitcoin treasury company.

In contrast, Metaplanet shares have declined 18.44% over the past month. It saw a daily decline of 12.36% on Tuesday, closing the day at 482 yen. This is a 74.5% decline compared to its all-time high closing price of 1,895 yen. However, Metaplanet is still up 38.5% year to date.

Metaplanet's mNAV drop also coincides with the company's temporary suspension of the 20th-22nd series of stock acquisition rights to "optimize capital raising strategies" in its bitcoin treasury expansion strategy.

Meanwhile, Benchmark Equity Research previously noted that, despite the short-term stock downturn, the strategy remains supported by the "fundamental rationale" for bitcoin as a scarce, programmable reserve asset and a hedge against inflation.

Benchmark analyst Mark Palmer also pointed to the company's ongoing initiative to utilize its bitcoin for financial products as a differentiating factor, setting a price target of 2,400 yen by the end of 2026.

The Block has reached out to Metaplanet for comment.

mNAV as an indicator

Many consider mNAV a crucial indicator of a digital asset treasury company's health, as it is the key metric that determines its ability to raise capital and accumulate more crypto without diluting shareholders. 

Several other digital asset treasury companies have seen their mNAV dip below 1, including Joe Lubin-led SharpLink Gaming. During an interview at The Block's "The Crypto Beat" podcast, Lubin said the mNAV ratio may fall temporarily in a digital asset treasury firm due to "cyclical" trends in broader markets.

Over the weekend, the broader equities and crypto markets saw substantial losses after U.S. President Donald Trump confirmed his plans to apply a 100% tariff on all imports from China, triggering market-wide fears of a U.S.-China trade war.

While markets have partially recovered, the Chinese government has vowed earlier today to "fight to the end" in the trade dispute, setting the grounds for more market instability in the near term.