Why Did Metaplanet’s Stock Option Plan Spark Controversy? Bitcoin treasury company Metaplanet has defended a controversial management stock-option plan after investors raised concerns that th
Bitcoin treasury company Metaplanet has defended a controversial management stock-option plan after investors raised concerns that the structure could increase executive ownership while diluting existing shareholders during the company’s aggressive Bitcoin accumulation strategy. The plan gives Chief Executive Simon Gerovich and four other employees the right to acquire 188 million shares at 10 yen each, significantly below
Metaplanet’s market price of around 286 yen. The main point of criticism was not only the discounted exercise price, but the way the original structure adjusted alongside new share issuance. The plan was designed so management’s potential allocation remained close to 20% of the company’s fully diluted shares. That meant every time Metaplanet issued new shares to raise capital for Bitcoin purchases, existing shareholders faced dilution while the number of shares available under management’s options increased automatically. The option pool expanded from roughly 46 million potential shares to 319 million before the company froze the number of reward shares available. Gerovich’s rights eventually covered 113 million shares, including 64 million shares he had already exercised. Following investor criticism,
Metaplanet reduced the option pool by 41% on Sept. 11, bringing it down to approximately 188.2 million shares.
In a Sept. 29 letter, Metaplanet’s independent directors argued that the original structure should be viewed in the context of the company’s situation when it was created. The plan was approved in 2023, when Metaplanet was still a struggling hotel operator. The company later shifted its strategy toward Bitcoin accumulation in April 2024. The independent directors said management purchased the rights using personal funds at fair value during a period when the company faced financial difficulties and when the success of its transformation was uncertain. They argued that the options should not be viewed simply as compensation awarded after the Bitcoin strategy succeeded. Instead, they described the structure as an early investment by executives who accepted risk while attempting to rebuild the company. None of Metaplanet’s current independent directors were on the board when the original rights were issued. The directors also argued that comparisons with other companies should consider founder ownership structures and that management’s cash compensation remained limited.
Investor Takeaway
Metaplanet’s stock-option dispute highlights the tension between rewarding executives for a successful corporate turnaround and protecting shareholders from dilution. The key issue for investors is not only the Bitcoin strategy itself, but how ownership is distributed as the company raises more capital.
What Changed After The Option Pool Was Reduced?
Metaplanet said the Sept. 11 revision eliminated more than $220 million in potential value from the company’s warrant structure and removed automatic adjustments linked to future equity issuance after Sept. 1, 2025. The revised plan also introduced restrictions on when remaining options can be exercised, with the schedule extending through 2031. Shares already acquired through exercises remain locked until August 2031. According to the independent directors, the changes improved fully diluted Bitcoin per share by approximately 8.8%. Exercised and unexercised rights now represent about 12.5% of total shares, according to the company. Gerovich, who is the only director holding the rights, did not participate in the review or approval of the changes, the directors said.
What Questions Remain After Metaplanet’s Defense?
While the company reduced the option pool, some shareholder concerns remain unresolved. The directors’ letter did not address the 64 million shares Gerovich acquired by exercising options in August before the Sept. 11 reset. Those shares remain outstanding because Metaplanet said the exercises were valid under the terms that existed at the time. Investors have also continued to examine MMXX Ventures, a Metaplanet shareholder connected to concerns around share sales and Gerovich’s personal economic interest in the entity. MMXX sold Metaplanet shares after the company adopted its Bitcoin treasury strategy, while Metaplanet itself was raising capital through equity issuance. Gerovich has said he is a significant but non-majority shareholder in MMXX’s parent company and does not participate in its trading decisions. Metaplanet disclosed voting control over MMXX but has not publicly detailed the extent of Gerovich’s personal economic interest in the entity’s share transactions. The debate comes as Metaplanet continues to position itself as one of the most visible corporate Bitcoin treasury companies. The company’s share price closed 2% higher on Wednesday at 286 yen, but the governance questions surrounding executive incentives remain a central issue for investors evaluating the strategy.
