Metaplanet Receives “Bad” Rating from VanEck for Executive Compensation Practices

VanEck’s latest research note, released on September 18, gave Metaplanet a “Bad” rating for its executive compensation practices, making it the sole company among the ten largest digital‑asset treasury firms to earn that grade. The rating persists despite recent reductions to the company’s option pool.

What is a digital‑asset treasury company?

A digital‑asset treasury company is a public firm whose primary business is holding cryptocurrency on its balance sheet. Metaplanet, listed in Tokyo, holds roughly 43,000 Bitcoin (BTC) and funds purchases by issuing new shares, debt and preferred stock.

How executive pay is structured

Executives receive part of their compensation in stock options – the right to buy shares at a fixed price in the future. The size of the option pool determines how much of the company’s equity can ultimately be claimed by management.

Growth of Metaplanet’s option pool

In February 2023, shareholders approved a rescue plan that granted seven staff members options over 46 million shares at a ¥10 strike price, with a clause that reset the award to 20 % of any new shares issued. After adopting a Bitcoin‑focused strategy in April 2024, Metaplanet issued equity to fund purchases, causing its share count to rise from 153.9 million to about 1.35 billion in two years. The option pool expanded proportionally, from 46 million to roughly 319.5 million shares.

VanEck’s four compensation tests

• Size of the option pool relative to fully diluted shares
• Proportion held by named executives
• Whether the pool can increase without a shareholder vote
• Whether the largest award includes a performance hurdle

Metaplanet’s pool represents 14.7 % of fully diluted shares, compared with a 4.0 % average among peers. Executives hold 8.2 % of shares, versus 0.8 % on average. The company failed all four tests, while the other nine firms passed.

Recent board actions

Under shareholder pressure, the board took two actions:

1. On August 18, it repealed the evergreen dilution clause, though the pool size remained unchanged.
2. On September 11, it rolled back terms to pre‑September 2025 levels, cutting the pool by 41 % to 188.2 million shares. However, 82.8 million shares had already been granted under the prior terms, leaving about 105.4 million potential new shares (≈7 % of the company).

   VanEck maintains that the company’s compensation structure remains far worse than any peer, so the “Bad” rating stands. The firm outlined four changes that could improve the rating: cancel the roughly 273 million shares created by the clause, adopt a smaller shareholder‑approved plan, tie pay to Bitcoin per share, and implement a written grant‑timing policy.