Background: Metaplanet is a Japanese company holding Bitcoin, whose stock performed outstandingly in 2021 and has recently become the most shorted stock in Japan. The stock hit a record trading volume on May 20, with a monthly increase of 121% and a 57% rise over the past week.

Key Events: Metaplanet's stock hit the daily price limit on the Tokyo Stock Exchange for two consecutive days, with massive trading volume. Several analysts have compared this to the 2021 U.S. Gamestop (GME) short squeeze event. CEO Simon Gerovich criticized hedge funds' strategy of shorting Bitcoin, while BlockStream CEO Adam Back believes the stock is undervalued and poses significant shorting risk. Investors predict the stock may continue hitting price limits, forming a "slow-motion" short squeeze.

Potential Impact: Since Metaplanet is highly correlated with Bitcoin prices and institutional interest in Bitcoin is increasing, hedge funds shorting the stock face substantial risk. If Bitcoin prices break through historical highs, it may trigger a larger-scale short squeeze.

HIGHLIGHTS Metaplanet becomes the most shorted stock in Japan after stellar 121% monthly gains.  The stock recorded unprecedented trading volumes on May 20, with 21.14 million shares of $MTPLF traded OTC in the U.S. BlockStream CEO Adam Back cites Metaplanet's low valuation relative to historic metrics. Metaplanet (TYO: 3350) is making news as it has become Japan's most shorted stock. The stock has come on the radar of hedge funds following a massive 57% gain over the past week, and a 163% gain on the monthly chart. With the stock now trading at a yearly high of 933 JPY, short bets have shot up significantly. Many analysts are now comparing this to euphoric GME short squeeze of 2021.
Bet Against Bitcoin? Metaplanet CEO Slams Hedge Funds
With its aggressive Bitcoin purchases and stellar Q1 results, the Japanese firm's stock price has seen mammoth trading volumes on the Tokyo Stock Exchange, as well as other global indexes. However, looking at the Japan equity data, it turns out that Metaplanet is the most shorted stock by hedge funds in the country. Speaking on this development, company CEO Simon Gerovich said:
"Apparently Metaplanet is the most shorted stock in Japan. Do they really think betting against Bitcoin is a winning strategy?"


The company's Bitcoin Strategist, Dylan LeClair, showed how the stock has achieved record trading volumes on May 20. In Germany, the company’s DN3 shares witnessed a staggering 2.51 million shares traded, with a total transaction value of €15.35 million. Meanwhile, the over-the-counter (OTC) U.S. ticker $MTPLF recorded 21.14 million shares traded, amounting to $150.29 million in value.
Hedge Funds to Witness Short Squeeze Soon?
Crypto industry experts believe that despite this massive rally, the Metaplanet stock is relatively cheap. Reiterating his previous stand, BlockStream CEO Adam Back explained:

"IMO @Metaplanet_JP is relatively cheap based on historic mNAV ranges, and on months to cover metric so shorting it seems like a really bad idea to me! this is the second 3350:TYO circuit-breaker limit-up day in a row, really bad timing to be short".

For the second-straight trading session, the stock has hit a circuit on the Tokyo Stock Exchange today, within just 2 minutes of starting the day's trading. Investor Brian Brookshire has hinted at another potential limit-up day for $MTPLF stock, predicting continued momentum in its rally.

"If $MTPLF is any indication, 3350 will hit limit-up again tomorrow as well. How many days in a row can it hit limit-up, I wonder... Short squeeze in slow-mo," Brookshire noted in a recent statement. Bitcoin maverick Michael Saylor also praised the recent rally in the stock price.

Is this the Gamestop (GME) Moment of 2021?
Gamestop (GME) was one of the most shorted stock back in 2021 with large hedge funds betting against declining business. But, then the GME stock price rose by 3200% and liquidated the shorted hedge funds. It was a bull run popular executed by a popular subreddit, wallstreetbets.











Analysts are comparing this to the current situation of Metaplanet as it is heavily shorted by Japanese hedge funds. Metaplanet is not a very big stock and as such does not have enough liquidity required for exit in case of a short squeeze. Considering that Metaplanet is now heavily invested into Bitcoin it is highly co-related to BTC price.

Institutional interest is only rising in Bitcoin and as BTC price looks to break all time highs, these hedge funds are in a very risky spot.

Metaplanet becomes Japan's most shorted stock, potentially triggering a short squeeze similar to GME in 2021