Key Points
- Microsoft urges shareholders to reject a proposal for a Bitcoin investment assessment.
- The company cites prior and ongoing evaluations of Bitcoin as an investment option.
Microsoft is advising its shareholders to vote against a proposal that seeks to evaluate Bitcoin as an investment asset. The company states that such an assessment is unnecessary due to its existing consideration of Bitcoin as an investment option.
The proposal for a Bitcoin investment assessment is one of the items listed for voting in a Dec. 10 annual meeting, according to an Oct. 24 filing with the U.S Securities and Exchange Commission. However, Microsoft’s board suggests that shareholders should vote against the proposal.
Microsoft’s Stance on Bitcoin
The company’s argument against the proposal is based on its claim that it already considers the topic of Bitcoin investment. “Microsoft has carefully considered this topic in the past and continues to monitor trends and developments related to cryptocurrencies to inform future decision making,” the board explained in response to the proposal.
The National Center for Public Policy Research, an independent think tank, lodged the proposal. The supporting statement references MicroStrategy’s Bitcoin investment strategy and the company’s stock outperformance of Microsoft by over 300% this year, despite doing a fraction of Microsoft’s business.
Increasing Adoption of Bitcoin
The proposal also highlights the increasing trend of companies adopting Bitcoin as an investment instrument. Notably, BlackRock, Microsoft’s second largest shareholder, started offering Bitcoin exchange-traded funds earlier this year.
The National Center for Public Policy Research stated, “Bitcoin is an excellent, if not the best, hedge against inflation and corporate bond yields are less than the true inflation rate. Companies should also not risk shareholder value by ignoring Bitcoin altogether.” They further suggested that institutions like Microsoft should consider the benefits of holding at least 1% of their assets in Bitcoin.
While it is unclear whether Microsoft plans to invest in Bitcoin in the near future, the company did offer Bitcoin as a payment option for its online Xbox store between 2014 and 2018.
In Sept. 2023, a document leaked to Axios suggested that Microsoft plans to add crypto wallets to its next Xbox console in 2028. This information is subject to change, as the document was dated May 2022 and the new update is still a few years away.