David Bailey, chairman and CEO of Nakamoto, defended Metaplanet’s executive option program in a string of X posts on Tuesday, saying a company giving 20% of its cap table to its team over five years is not an outlandish number. He added that the figure looked low to him. Bailey also said he has owned the stock since Metaplanet made its first bitcoin purchase.
Option pool grew as bitcoin-financing rounds expanded the share count
The controversy centers on Metaplanet’s Series 10 stock acquisition rights, which were adopted in December 2022 before the company shifted to a bitcoin-focused strategy. The executive award pool was structured as a share of the fully diluted count rather than as a fixed number of shares.
That design meant each equity raise used to fund a bitcoin purchase increased the insiders’ claim at the same time it diluted existing shareholders. The pool grew from roughly 46 million shares to about 319 million.
Metaplanet’s own amendment notice acknowledged that the provision amplified dilution and made the company’s diluted share count difficult to pin down.
Board fixed the pool but left disputed shares in place
On Aug. 18, the board removed the provision and fixed the pool at 319.46 million potential shares, with a lock-up running until August 2031.
The company did not cancel the roughly 273 million shares that critics want unwound, leaving the central dispute unresolved.
Metaplanet shares closed Tuesday at 244 yen, down about 17% over two sessions, while bitcoin traded roughly flat.
Bailey framed the issue around performance
Bailey argued that Metaplanet’s results support the compensation structure. He said the company was the world’s best-performing equity for close to two years, remains up 1,300% from inception even after bitcoin’s drawdown, has increased bitcoin per share by more than 40x, and has built the second-largest corporate bitcoin position.
"Every founding team should hold meaningful economics in what it builds," Bailey wrote, pointing to Michael Saylor at Strategy and Vivek Ramaswamy at Strive.
Strive CEO says the comparison does not hold
That precedent argument drew a rebuttal from Matt Cole, who has served as Strive’s CEO since April 2023. Cole said the 270.5 million pre-split Class B shares often cited in discussions about Strive were merger consideration issued to all pre-merger equityholders, not a management award.
He added that Vivek Ramaswamy is neither an officer nor a director and that no shares vested for him during Cole’s tenure.
"No Strive award automatically expands with new issuance," Cole wrote. He also said his own vested economic ownership is below 1%.
According to Cole, Strive’s target annual equity compensation for a team of more than 30 totals about $21 million. He said that figure is benchmarked with Mercer at the 50th percentile and vests over three years against bitcoin.
Shareholders were sharper in their criticism
Shareholders took a tougher line than either executive. Falconedge advisor ZynxBTC wrote on X that trying to justify $500 million in compensation for 30 months of work by a few people, with most of that amount created by a clause the company has now removed, is "insane."
Debate lands as MSCI reviews index eligibility
The timing adds another layer. MSCI is consulting on whether to remove non-operating companies from its equity indexes, a screen that would eliminate both Metaplanet and Strategy. Results are due by Oct. 16.