Microsoft Board Urges Shareholders to Reject Bitcoin Investment Proposal at December Meeting
Key Takeaways:
- Microsoft’s board recommends shareholders vote against a proposal to assess Bitcoin as an investment.
- The National Center for Public Policy Research (NCPPR) proposed the assessment, pointing to MicroStrategy’s success with Bitcoin.
- Major shareholders, including BlackRock, will vote on the proposal at the annual meeting on December 9.
In an October 24 filing with the U.S. Securities and Exchange Commission (SEC), Microsoft disclosed that “Assessment of Investing in Bitcoin” would be up for shareholder vote in its upcoming annual meeting on December 9.
Despite the proposal, Microsoft’s board recommends that shareholders reject it, arguing that the company already evaluated various investment assets, including Bitcoin, as part of its financial strategy.
Microsoft Shareholders Meeting and Bitcoin Investment Proposal
According to the SEC filing, the proposal was submitted by the National Center for Public Policy Research (NCPPR), a conservative think tank.
The NCPPR argues that Bitcoin could be an effective hedge against inflation, urging companies to consider holding even a small portion of their reserves in the cryptocurrency.
The research group highlighted MicroStrategy’s Bitcoin-focused investment approach, which led to a stock price increase of over 300% this year despite the company being significantly smaller than Microsoft in terms of operations.
Microsoft has long maintained a diversified corporate treasury strategy that emphasizes stability.
The company cited Bitcoin’s high volatility as a risk factor that could undermine the liquidity and predictability essential to treasury management.
Microsoft noted that major shareholders, including Vanguard, BlackRock, and State Street, are advised to weigh these risks, as many corporate treasuries prefer predictable assets to support ongoing operations.
The company stated,
“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.”
AI Investments and Limited Engagement with Cryptocurrency
Microsoft has centered recent investments around artificial intelligence(AI) and cloud infrastructure, further avoiding cryptocurrency.
Earlier this month, the company committed $4.8 billion over the next two years to strengthen its AI and cloud capabilities in northern Italy.
Continuing its global expansion, Microsoft also announced a $1.3 billion investment in cloud and AI infrastructure in Mexico on September 24, aimed at promoting inclusive growth through digital technology and other skill programs.
Although Microsoft briefly accepted Bitcoin payments on its Windows and Xbox platforms, its cryptocurrency ventures remain minimal.
This contrasts with companies like MicroStrategy, which embraced Bitcoin early and is now the largest corporate Bitcoin holder, with 252,220 BTC worth approximately $17 billion.
However, Microsoft has been showing glimpses of the adoption of web3 technologies with its recent launch of a Blockchain-based smart contract initiative to improve its supply chain efficiency.
Powered by Microsoft Azure Cloud, this Supply Chain Blockchain Initiative leverages blockchain to form a consortium of verified suppliers, offering verifiable data and streamlined transactions. Instead, it opts to focus on other growth areas like AI.