Metaplanet Shares Sink 17% in Two Days Despite CEO Explanation as Investor Backlash Persists

Metaplanet shares fell for a second straight day, extending their two-day decline to about 17%, as investors continued to push back after saying Chief Executive Officer Simon Gerovich’s public explanation failed to resolve their core concerns.

Crypto news outlet The Block reported on September 8 that Tokyo-listed Metaplanet closed down 9.9% at 244 yen. The stock had already dropped 7.5% the previous day, bringing its two-day loss to about 17%. Bitcoin traded largely unchanged over the same period at around $78,464.

The selloff was triggered by the company’s Series 10 executive stock option plan, introduced in December 2022. The plan was designed to automatically reset the option pool to 20% of fully diluted shares outstanding rather than a fixed number of shares. As Metaplanet repeatedly issued stock to raise funds for Bitcoin purchases, the option pool expanded from about 46 million shares to about 319 million shares. The increase drew criticism that executive options kept swelling while existing shareholders absorbed dilution.

In a post on X, Gerovich acknowledged that the company had failed to sufficiently explain the plan and its structure to shareholders. He wrote that the automatic adjustment clause was removed effective August 18 and that the option pool was frozen at 319.46 million shares. He added that a mandatory five-year holding requirement had also been imposed through August 2031. He said the company was continuing to review its governance and compensation policies and would share the results once available.

Investor backlash, however, has not eased. While the company prevented any further increase in the option pool, the rights tied to the roughly 273 million shares already added remain intact. An X user identified as Ragnar argued that the only option was to cancel the additional 273 million shares and replace them with a new incentive program. Another investor, The Bitcoin Pharaoh, said Gerovich exercised 92,000 Series 10 options 10 days after the pool was frozen, receiving more than 64 million shares. The investor criticized Gerovich for acknowledging the structure was flawed while still retaining the benefits created by it.

Gerovich’s relationship with MMXX Ventures, a Metaplanet shareholder, has also come under scrutiny. Conflict-of-interest concerns emerged after Japanese disclosure filings were reported to state that Gerovich indirectly holds a majority of MMXX’s voting rights. Gerovich said he is a major shareholder in MMXX’s parent company, but not a majority shareholder, and that he holds no director or executive post and is not involved in investment or trading decisions. Even so, some investors are publicly demanding disclosure of MMXX’s ultimate beneficial owners and whether Gerovich or related parties profited from MMXX’s sales of Metaplanet shares during the stock’s surge in 2024.