Author: Pzai, Foresight News
As the United States makes significant progress in the regulatory compliance of Bitcoin investments, more and more companies are beginning to show interest in crypto assets. With the successful experience of MicroStrategy, the National Center for Public Policy Research (NCPPR) has formally advised Microsoft to invest 1% of its profits in Bitcoin to hedge against inflation.
On December 10, Microsoft's major shareholders voted against including Bitcoin on the company's balance sheet. As a result, the market sentiment has been somewhat dampened, with Bitcoin trading at $97,304 as of the time of writing, a pullback from the recent highs. Is the "crypto stimulant" not favored by all US stock investors? And why did the shareholders politely reject the strategic investment in the emerging asset?
Emerging Interest
In October this year, Microsoft had already included the issue of Bitcoin investment in the shareholder voting meeting, which was proposed by the conservative think tank National Center for Public Policy Research (NCPPR). The board of directors recommended that shareholders vote against this proposal in the document, stating that the proposal "is not (necessary)" because the company's management "has already carefully considered this proposal", and also stating that volatility "is a factor to consider when evaluating cryptocurrency investments". Two months have passed, and Bitcoin has once again surpassed its historical high, while MicroStrategy, another US-listed company, has also become a dark horse in the US stock market through its embrace of Bitcoin, with its stock price soaring rapidly in a short period of time.
It is precisely because of his own successful experience that MicroStrategy CEO Michael Saylor has tried to persuade Microsoft shareholders to support the NCPPR's proposal. Saylor emphasized the value of Bitcoin as "digital capital", and pointed out that if Microsoft allocates a portion of its assets to Bitcoin, it may lead to a significant increase in its stock price. In addition, NCPPR also played a video claiming that Microsoft should not miss the "next technological wave" brought by Bitcoin, and demonstrated the potential value of holding Bitcoin.
However, despite this, Microsoft's major shareholders still chose to support the board's opinion, believing that including Bitcoin on the company's balance sheet is not in the long-term interests of shareholders. They are concerned that the high volatility of Bitcoin will have a negative impact on the company's financial stability, and are uncertain whether such an investment can guarantee a positive return for investors. Proxy advisory firm Glass Lewis also pointed out that experts generally believe that it cannot be guaranteed that investing in cryptocurrencies will increase the overall return of the investment portfolio.
Market Sentiment
In the market, traders are also generally not optimistic about the decision of Microsoft's shareholders, with the probability of the Bitcoin investment proposal being approved fluctuating around 10%-20% on Polymarket.
In the US stock market, in addition to Microsoft's attempt, some companies are also actively trying to include Bitcoin in their corporate reserve assets, such as Tesla, Riot Platform, and Galaxy Digital. If Microsoft takes the same measure, it will become the largest Bitcoin-holding company by market capitalization. Bernstein's analysts stated that large technology companies have a large amount of current liquidity that can be deployed through Bitcoin, but given the dominant position of their core businesses, Bitcoin may become a non-substantive part of the corporate asset strategy, while small companies with cash surpluses and weak core businesses can emulate MicroStrategy's model.
It is worth noting that Microsoft's two major institutional investors, Vanguard and BlackRock, played an important role in this vote. As one of Microsoft's largest shareholders, the attitudes of these institutional investors have a decisive influence on the final result. At the same time, BlackRock itself also provides crypto ETF products for clients and is active in the crypto investment market. However, in Microsoft's strategic choice, these shareholders still lean towards assets with stronger stability, indicating that although some large financial institutions have already begun to venture into the cryptocurrency market, they are still cautious about the risks of strategic corporate holdings of such assets.
In summary, the result of Microsoft's shareholder vote reflects the dilemma currently faced by American companies when considering whether to venture into the cryptocurrency field: on the one hand, with the continuous rise in Bitcoin prices and the effects of the Trump administration, more and more companies are beginning to accept it as a legitimate investment tool and reserve asset; on the other hand, due to concerns about the security and stability of corporate funds, there are certain restrictions on the investment scale. In this case, Microsoft chose to maintain its existing investment strategy and continue to focus on more stable and predictable investment options, but this vote has already sent a strong signal to the crypto market and also raised expectations for future crypto adoption.
