Japan’s largest stock exchange operator is considering new restrictions on publicly traded companies that focus their core business on buying and holding cryptocurrencies, signaling a potential shift in one of the most active markets for digital asset treasury (DAT) companies.
Citing anonymous sources familiar with internal deliberations, Bloomberg reported that Japan Exchange Group (JPX) is exploring stricter scrutiny for companies that shift their core business toward large-scale cryptocurrency accumulation. This includes new auditing requirements and stricter backdoor listing assessments.
The move comes after a wave of losses hit Japan’s DATs, many of which attracted retail investors earlier this year. Metaplanet, Japan’s largest DAT with over 30,000 Bitcoin (BTC), saw its shares fall from a year-to-date (YTD) high of $15.35 on May 21 to $2.66 at the time of writing. This marks a drop of 82% from its highest value this year.
Japanese nail salon franchise Convano, which performed strongly in August, is now trading at around $0.79 per share, a 61% drop from its high of $2.05 on August 21. Data from BitcoinTreasuries.NET showed that the company is also down almost 11% on its BTC investment.
Backdoor listing rules would fill a regulatory gap
Applying backdoor listing rules to companies engaging in cryptocurrency accumulation would mark a significant tightening of Japan’s listing standards.
Public listings occur when a private company acquires an already publicly traded shell company to avoid the traditional initial public offering (IPO) route, and the JPX already prohibits such moves.
Extending the ban to publicly traded companies moving to cryptocurrency holding vehicles would close a regulatory gap that some DATs may have exploited to evolve their business models.
If JPX formally restricts such pivots, it could slow or stop the process of listing new DATs.
Related: Strategy’s Bitcoin Dominance Falls in October as Corporate Treasuries Expand
Metaplanet boss highlights governance measures in response to JPX report
Meanwhile, Metaplanet CEO Simon Gerovich rejected the implication that companies hoarding Bitcoin may have circumvented governance or disclosure rules.
In an He said this does not apply to Metaplanet.
“In contrast, at Metaplanet we have held five shareholder meetings in the last two years (four extraordinary general meetings and one annual meeting), ensuring shareholder approval for all critical matters.”
He added that they also modified the company’s bylaws and increased the shares authorized to finance BTC purchases. He said the company adhered to formal governance processes under the same management team that had led the company before the turnaround.
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