In a decisive move, Microsoft shareholders voted against a resolution to incorporate Bitcoin into the company’s balance sheet during the annual meeting on December 10. The proposal, initiated by the National Center for Public Policy Research (NCPPR), aimed to diversify shareholder value by leveraging Bitcoin’s potential.
The Proposal and Its Promoters
The NCPPR, a pro-free-market think tank, introduced the resolution with a pre-recorded video presentation, highlighting the promising future of Bitcoin. They emphasized that Bitcoin could represent the next major technological wave that Microsoft must not overlook. The proposal included data and charts illustrating the potential financial benefits of adopting Bitcoin, suggesting that such a move could generate trillions in value and mitigate risks for shareholders.
Key Arguments for Bitcoin Adoption
The core of the NCPPR’s argument revolved around the increasing institutional and corporate adoption of Bitcoin. They noted that BlackRock, Microsoft’s second-largest shareholder, offers a Bitcoin ETF to its clients, underlining the growing acceptance and integration of Bitcoin in the financial world. The proposal suggested that Microsoft allocate 1% to 5% of its profits for Bitcoin purchases, asserting that this minimal investment could provide significant long-term benefits.
Michael Saylor, a prominent Bitcoin advocate, also addressed Microsoft’s board, proposing that the company could see a substantial increase in its market cap—up to $5 trillion—if it fully embraced Bitcoin. His plea highlighted the perceived urgency and potential missed opportunities if Microsoft did not act quickly.
Board’s Opposition and Shareholders’ Decision
Despite the enthusiastic pitch from NCPPR and Michael Saylor, Microsoft’s board opposed the proposal, deeming it “unnecessary.” In a filing with the U.S. Securities and Exchange Commission (SEC), the board emphasized the importance of stability and predictability in corporate treasury investments, which they argued Bitcoin could not provide due to its inherent volatility.
The board’s statement highlighted their existing strategies for managing and diversifying the company’s treasury, suggesting that the additional public assessment called for by the proposal was unwarranted. They pointed out that the FOMO (Fear of Missing Out) sentiment driving the proposal was not a solid basis for such a significant financial decision.
Ultimately, the shareholders sided with the board, voting against the resolution. The preliminary results indicated a clear preference for maintaining the current approach to treasury management without incorporating Bitcoin.
Looking Ahead
Interestingly, the NCPPR has not limited its efforts to Microsoft. On December 8, they submitted a similar proposal to Amazon, to be considered at the company’s April 2025 shareholder meeting. This proposal argues that Bitcoin could serve as a hedge against inflation, protecting Amazon’s substantial cash reserves from erosion.
Conclusion
Microsoft’s rejection of the Bitcoin reserve proposal underscores the cautious stance many large corporations still hold towards cryptocurrency. While the potential benefits of Bitcoin are compelling to some, the volatility and risks associated with it continue to be significant barriers. As the cryptocurrency market evolves, it will be intriguing to see how corporate giants like Microsoft navigate these opportunities and challenges.
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