Key Takeaways
- A think tank’s proposal to assess Bitcoin as an investment was rejected by Microsoft’s shareholders, the company’s board instructed.
- Bitcoin, according to the corporation, is already taken into account when making financial decisions.
- Microsoft may benefit from MicroStrategy’s success with Bitcoin, according to the National Center for Public Policy Research’s suggestion.
In a filing with the SEC on October 24, the board of Microsoft recommended that shareholders reject a proposal that sought to evaluate Bitcoin as an investment asset.
The National Center for Public Policy Research delivered the proposal (NCPPR). Since 2021, Microsoft has been a shareholder of the conservative research tank.
An Overview of Microsoft’s Proposal, the Impact of MicroStrategy, and the Increasing Adoption of Bitcoin
The board noted in the filing that Bitcoin and other digital assets have been included in prior assessments and that the company is still keeping up with cryptocurrency developments to influence future choices.
Microsoft emphasized how proactive it was in viewing Bitcoin patterns as a good enough reason to reject the request.
MicroStrategy’s Bitcoin investment strategy was mentioned in the NCPPR proposal, which highlighted the company’s substantial return for shareholders and its position as the largest corporate Bitcoin holder with 252,220 BTC, or over $17 billion.
Despite having a smaller commercial presence, MicroStrategy’s stock has increased 300% this year because of its four-year Bitcoin accumulation, outperforming Microsoft’s stock performance.
The proposal also noted that BlackRock, the second-largest shareholder in Microsoft, has recently entered the Bitcoin ETF market, suggesting that institutional acceptance of Bitcoin is increasing.
Proponents of the idea contend that the underwhelming performance of corporate bond yields and Bitcoin’s ability to hedge against inflation highlight its worth. As of October 11, the software behemoth has $108.1 billion in cash reserves.
Even a 1% Bitcoin allocation, according to the NCPPR, may have a big impact on shareholder value. Although the IT industry has not yet broadly adopted the idea, this is consistent with a larger trend of businesses using Bitcoin as a reserve asset.
A vote on the idea is planned for December.
Microsoft’s Previous Bitcoin Activities and Possible Future Steps
Although it’s unclear if Microsoft shareholders will follow the board’s recommendations, the business has previously dealt with Bitcoin, briefly taking it as payment on its Xbox platform from 2014 to 2018.
Furthermore, a September 2023 document leak suggested that the upcoming Xbox system, which is scheduled for release in 2028, would incorporate a cryptocurrency wallet.
But it seems like Microsoft is more interested in developing its AI projects than exploring blockchain assets at this time.
According to Google Finance, Microsoft’s stock price has remained stable over the past day, rising by 0.03% to $424.7.
