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MicroStrategy’s Executive Chairman Michael Saylor has drawn attention to Bitcoin’s potential for corporate balance sheets. He also suggested a trillion-dollar deal to Microsoft, a leading tech company. Moreover, this could mark the beginning of a new era of corporate adoption of Bitcoin.
MicroStrategy’s Saylor Proposes Major Deal to Microsoft CEO
Saylor believes Microsoft could unlock substantial shareholder value by diversifying into BTC. As Microsoft faced a proposal for a Bitcoin diversification assessment at its recent annual meeting, Saylor directed a public message to Microsoft CEO Satya Nadella:
“Hey Satya Nadella, if you want to make the next trillion dollars for $MSFT shareholders, call me.”
The proposal for Microsoft to consider adding Bitcoin to its treasury assets, submitted by the National Center for Public Policy Research, emphasized the value of assets that appreciate amid inflationary pressures. The statement argued, “Corporations have a fiduciary duty to maximize shareholder value not only by working to increase profits but also by working to protect those profits from debasement.”
Hey @SatyaNadella, if you want to make the next trillion dollars for $MSFT shareholders, call me. pic.twitter.com/NPnVvL7Wmj
— Michael Saylor⚡️ (@saylor) October 25, 2024
The shareholder group underscored that Bitcoin outperformed traditional corporate bonds significantly over recent years, delivering 414% growth over the past five years. The proposal also highlighted that MicroStrategy saw its stock outperform Microsoft’s by a striking 313% this year, despite being a much smaller entity.
In addition, Matthew Sigel, VanEck’s Head of Digital Assets Research, also highlighted Microsoft’s evaluation of Bitcoin and other cryptocurrencies for their treasury potential. In a recent post on X (formerly Twitter), he explained, “MSFT has & ‘will continue to monitor trends & developments related to cryptocurrencies to inform future decision-making.’”
MSFT Says Company Already Considers #Bitcoin as Possible Treasury Asset, Making the Shareholder Proposal Redundant.
MSFT Has & “Will Continue to Monitor Trends & Developments Related to Cryptocurrencies to Inform Future Decision-Making” https://t.co/9VLGN1YCBX pic.twitter.com/b4LuejpR46
— matthew sigel, recovering CFA (@matthew_sigel) October 25, 2024
Microsoft’s Shareholders to Vote on Bitcoin Proposal
Microsoft’s board has recommended a vote against the proposal, stating that its Global Treasury and Investment Services team already evaluates diverse assets, including cryptocurrencies, to ensure both diversification and inflation protection for the company. According to Microsoft’s official response, the board believes an assessment focused specifically on Bitcoin would be unnecessary, as “Microsoft’s management already carefully considers this topic.
They added that “volatility is a factor to consider in evaluating cryptocurrency investments for corporate treasury applications that require stable and predictable investments.” Nonetheless, advocates of Bitcoin’s integration believe its long-term appreciation could offer unique value in times of high inflation.
The shareholder proposal noted that U.S. inflation averaged 5.03% over the last four years. This means that a corporation’s assets would need to appreciate significantly “just to break even.” Hence, it cited Bitcoin’s recent performance, which saw a 99.7% increase in price from the previous year, as evidence of its resilience as a store of value.
With MicroStrategy’s recent stock surge to a 25-year high at $234.44, Bitcoin advocates see the proposal as an opportunity for Microsoft to follow the MSTR lead. However, Microsoft’s Board members have advised shareholders to disapprove the proposal. In addition, anti-crypto Vanguard owns around 9% of the company stock, which could influence the decision negatively. Nevertheless, the market awaits the shareholders’ decision.