Bitcoin companies are learning that holding forever takes cash

Metaplanet sold 10,000 BTC and bought back 11,000 at a higher average price to show it was willing to sell its Bitcoin.

The Japanese treasury company was pursuing a credit rating and better access to financing, and its Oct. 5 disclosure explained why turning coins into cash was part of that effort. Prospective creditors needed confidence that management could use its holdings to meet obligations, even if shareholders bought into the company because of those holdings.

Proving the point was expensive, with Metaplanet receiving ¥124.7 billion from the sale and spending ¥149.9 billion on the subsequent purchase, paying roughly 9.3% more per coin.

Applying that average purchase price to the 10,000 coins replaced produces a price difference of about ¥11.57 billion, before transaction costs and potential tax effects. That gives shareholders an expensive receipt for the demonstration.

The company didn't use the proceeds to repay borrowings or bonds, and it ended September with 44,000 BTC. Selling was part of an effort to improve the financing behind continued accumulation.

That brings us to the strange relationship underlying the corporate Bitcoin trade. Shareholders are usually happy to wait years for a higher price, but lenders have contracts that specify when they want their money back. The same reserve has to satisfy both groups.

A company that owns an asset as liquid as Bitcoin isn't quite the same as a company having cash available to pay a bill. Coins may be pledged against borrowing, or management may be unwilling to sell at the available price.

Either way, creditors need to know what happens when the payment date and the preferred selling price don't cooperate.

Metaplanet's June financial statement reported ¥67.49 billion in short-term borrowings and ¥8 billion in bonds payable within a year, against ¥1.09 billion in cash and deposits and ¥250 million in USDC.

The numbers exclude the company's much larger Bitcoin reserve and the financing it could access, so the gap explains why lenders want more than a coin count when assessing repayment.

The contracts give dates to that discussion, although the numbers below come from different reporting periods and shouldn't be read as a like-for-like comparison of current liquidity.

Sources: Metaplanet's bond terms, June accounts, and October disclosure; Strategy's June filing and October update.

Strategy's notes technically mature in September 2028, but the holder's right to demand repayment brings a potential cash obligation forward by a year.

Its June filing also lists roughly $4.9 billion of notes with similar holder repurchase rights during 2028, taking the principal associated with those 2027 and 2028 dates to about $5.91 billion.

Holders must exercise their rights, and conversions or repurchases could reduce those amounts before then, meaning the company has clear points when access to cash is more important than confidence in Bitcoin's eventual price.

This is why corporate Bitcoin has financing deadlines even though Bitcoin itself doesn't expire. Management can borrow again, issue securities, or use cash to meet obligations, but those options have their own costs, and they aren't equally attractive in every market.

Strategy has built a sizable dollar cushion, giving it more room. Its Oct. 5 filing reported a $4.88 billion dedicated reserve and another $833.4 million in separate dollar-denominated cash, totaling approximately $5.71 billion as of Oct. 4.

The dedicated reserve supports preferred-stock dividends and debt interest, and its policy requires board authorization for other uses. The separate cash balance provides a lot of flexibility, so adding the two together doesn't make the entire sum an unrestricted pot for future debt repayments.