Microsoft Will Face Bitcoin Investment Proposal In December
Microsoft will soon vote on a proposal that asks it to assess whether it should invest in Bitcoin (BTC), according to an Oct. 24 filing with the SEC.
The tech giant acknowledged that one of its shareholders, the National Center for Public Policy Research (NCPPR), plans to submit the proposal for voting during the Microsoft annual shareholder meeting on Dec. 10.
Microsoft holds that such an assessment is unnecessary. It said:
“Microsoft has strong and appropriate processes in place to manage and diversify its corporate treasury for the long-term benefit of shareholders and this requested public assessment is unwarranted.”
Microsoft claimed that its management already “carefully considers [the] topic” and acknowledged factors around the proposal. It said it has examined Bitcoin and other possible cryptocurrencies for investment in the past and continues to monitor trends. Microsoft also called crypto’s price volatility a factor for consideration.
Accordingly, Microsoft’s Board of Directors recommended that shareholders vote against the proposal in the upcoming meeting.
Proposal Focused on Shareholder Value
NCPPR requested the assessment to determine whether Microsoft adding Bitcoin to the balance sheet is in shareholders’ best long-term interests.
The organization suggested that investing in Bitcoin could protect against inflation that affects Microsoft’s other assets, noting that Bitcoin has recently undergone price increases and outperformed corporate bonds on average at times.
NCPPR nevertheless acknowledged volatility risk, suggesting that companies should not hold excessive amounts of Bitcoin. Instead, it said companies should evaluate the benefits of holding “some, even just 1%, of [their] assets in Bitcoin.”
Industry Provides Context
NCPPR’s proposal also noted that Microsoft’s second largest shareholder, BlackRock, offers a Bitcoin ETF. There is no indication as to how BlackRock will vote.
It additionally drew a connection to Microstrategy (MSTR), a company that does less business than Microsoft but has a significant Bitcoin investment strategy. NCPPR said MSTR has outperformed Microsoft stock (MSFT) by 313% this year.
In an X post, Michael Saylor, executive chairman at Microstrategy, invited Microsoft to contact him. Saylor addressed Microsoft CEO Satya Nadella, stating: “if you want to make the next trillion dollars for MSFT shareholders, call me.”
Microstrategy announced its Q3 2024 financial results on Oct. 30, revealing that it held 252,220 BTC with a market value of $16 billion as of Sept. 30.
Other industry members have also weighed in. Daniel Cawrey, chief strategy officer at the crypto wallet development firm Tonkeeper, reacted optimistically. In a statement to Bitcoin.com, he said the news means that Bitcoin is being considered in board rooms despite Microsoft’s opposition. The debate ultimately marks a “positive development for Bitcoin as a diversification tool,” he concluded.
