In a recent SEC filing dated Thursday, October 24, Microsoft Corporation (NASDAQ: MSFT) revealed that an “Assessment of Investing in Bitcoin” will be a voting item at its forthcoming shareholder meeting on December 10. This development has ignited discussions within the investment community about the potential direction of Microsoft’s treasury strategy and the likelihood of shareholder approval.
Microsoft’s board of directors has formally recommended voting against the Bitcoin investment proposal. In supplementary materials filed with the SEC on October 25, the board articulated that the requested assessment is redundant, emphasizing that Microsoft’s management already integrates considerations of cryptocurrencies into their broader investment strategy.
The board highlights that “This proposal requests that the Board conduct an assessment that is unnecessary because Microsoft’s management already carefully considers this topic. Microsoft’s Global Treasury and Investment Services team evaluates a wide range of investable assets to fund Microsoft’s ongoing operations, including assets expected to provide diversification and inflation protection.”
The filing further noted that past evaluations have included Bitcoin among other cryptocurrencies. “Past evaluations have included Bitcoin and other cryptocurrencies among the options considered, and Microsoft continues to monitor trends and developments related to cryptocurrencies to inform future decision making,” the filing adds.
The board asserted confidence in Microsoft’s existing processes to manage and diversify its corporate treasury for the long-term benefit of shareholders, deeming the public assessment unnecessary. “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.”
Microsoft’s shareholder base is a diverse mix of institutional investors, public companies, and individual investors. As of June 30, 2024, institutional investors held approximately 43.13% of Microsoft’s outstanding shares, while public companies and individual investors accounted for 56.84%. Insiders held a negligible 0.04% of the shares.
Given this distribution, these major shareholders could be pivotal in determining the outcome of the proposal. Vanguard’s anti-BTC stance suggests a likely “no” vote, aligning with the board’s recommendation.
Conversely, BlackRock has become a strong proponent of Bitcoin and offers its US clients a spot Bitcoin ETF since January this year. In their latest earning call, CEO Larry Fink said, “We believe Bitcoin is an asset class in itself.” He added, “It is an alternative to other commodities like gold.”
State Street seems somewhat open-minded to Bitcoin. In mid-September, State Street launched in collaboration Galaxy 3 new crypto ETFs. In August, State Street partnered with Taurus to enhance its crypto services, facilitating the transformation of real-world assets into tradable digital assets.
Nonetheless, industry analysts largely predict that the proposal to invest in Bitcoin will not gain sufficient support among Microsoft shareholders. Matthew Sigel, Head of Digital Assets Research at VanEck, summarized the situation on X: “Microsoft Shareholders to Vote on Proposal to Invest in Bitcoin. MSFT Board Advises ‘Nay’. No-Coiner Vanguard owns ~9%.”
Similarly, Nate Geraci, President of The ETF Store and Co-Founder of the ETF Institute, expressed his expectations: “Gonna go out on a limb & predict Microsoft’s largest shareholder (Vanguard) will be voting ‘no’ on adding btc to the balance sheet…”
Di Lewis, CFO at BTC Inc., also expressed strong skepticism about Microsoft’s likelihood to adopt Bitcoin, stating there is “0% chance Microsoft adds bitcoin to their balance sheet this decade.” Adam Cochran, a partner at CEHV, dismissed the proposal as a “fringe” idea from a think tank shareholder. He stated, “No. This is a fringe proposal by a think tank shareholder, and is not a serious consideration by Microsoft at large.”
At press time, BTC traded at $67,608.
Moving on to a different but equally intriguing topic, the question of what will happen to Bitcoin if Trump wins the upcoming elections has been a hotly debated issue among cryptocurrency enthusiasts. If Trump secures another term in office, Bitcoin might experience an uptick in value due to his previous pro-crypto stance and general support for deregulation. This could lead to relaxed cryptocurrency regulations, boosting confidence among Bitcoin investors.
Contrastingly, if Harris emerges victorious, the impact on Bitcoin could be more uncertain. Given the current administration’s cautious regulatory approach, a Harris presidency might continue with crypto oversight and regulatory frameworks, possibly creating a more structured but potentially restrictive environment for Bitcoin. This scenario might stabilize Bitcoin but limit rapid growth.
In either case, the outcome in Congress and key regulatory appointments will play a significant role in shaping the broader crypto policy landscape. The future of Bitcoin remains intertwined with political decisions and regulatory frameworks, making it a compelling area to watch for investors and enthusiasts alike.
(Links to the articles: Microsoft Bitcoin Investment and Bitcoin and the US Elections)
Links to the stories discussed:
- Secrets Revealed-> Will Microsoft Shareholders Vote ‘Yes’ On Bitcoin? What To Expect
- WHAT WILL HAPPEN TO BITCOIN IF TRUMP WINS?