Tokyo exchange operator eyes crackdown on Bitcoin-holding firms after DAT rout

Japan’s largest stock-exchange relation weighs caller restrictions connected publically listed companies that pivot their halfway concern into buying and holding crypto, signaling a imaginable displacement successful 1 of the astir progressive markets for digital-asset treasury (DAT) firms. 

Citing anonymous sources acquainted with interior deliberations, Bloomberg reported that Japan Exchange Group (JPX) is exploring stricter scrutiny for companies that displacement their halfway concern into large-scale crypto accumulation. This includes caller audit requirements and tougher backdoor-listing assessments.

The determination comes aft a question of losses deed Japan’s DATs, galore of which attracted retail investors earlier this year. Metaplanet, Japan’s largest DAT holding implicit 30,000 Bitcoin (BTC), saw its shares fall from a year-to-date (YTD) precocious of $15.35 connected May 21 to $2.66 astatine the clip of writing. This marks an 82% driblet from its highest worth this year. 

Metaplanet’s six-month terms chart. Source: Google Finance

Backdoor listing rules would capable a regulatory gap

Applying backdoor listing rules to companies pivoting into crypto accumulation would people a important tightening of Japan’s listing standards. 

Backdoor listings hap erstwhile a backstage institution acquires an already listed ammunition institution to bypass the accepted archetypal nationalist offering (IPO) route, and JPX already prohibits specified maneuvers. 

Extending the prohibition to listed firms that displacement into crypto-holding vehicles would adjacent a regulatory spread that immoderate DATs whitethorn person exploited to germinate their concern models. 

If JPX formally restricts specified pivots, it could dilatory oregon halt the listing pipeline for caller DATs.

Related: Strategy’s Bitcoin dominance slips successful October arsenic firm treasuries expand

Metaplanet brag highlights governance steps successful effect to JPX report

Meanwhile, Metaplanet CEO Simon Gerovich pushed backmost against the accusation that Bitcoin-accumulating firms whitethorn person sidestepped governance oregon disclosure rules. 

In an X post, Gerovich responded to the report, saying that JPX’s concerns are directed astatine companies suspected of conducting backdoor listings oregon pivoting into integer assets without due shareholder approvals. He said this does not use to Metaplanet. 

“In contrast, astatine Metaplanet we person held 5 shareholder meetings implicit the past 2 years (four bonzer wide meetings and 1 yearly meeting), securing shareholder support for each captious matters.”

He added that they besides amended the company’s articles of incorporation and accrued authorized shares to money BTC purchases. He said that the institution adhered to ceremonial governance processes nether the aforesaid absorption squad that had led the institution anterior to the pivot. 

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