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Microsoft to vote on holding Bitcoin as a reserve asset.
Posted on 10/25/24 at 7:54 am
Posted on 10/25/24 at 7:54 am
LINK
LINK
In December, Microsoft shareholders will vote on a proposal to adopt a strategy similar to MicroStrategy’s by holding Bitcoin as a reserve asset.
The board has recommended that shareholders vote against this proposal, and it’s likely that the motion will not pass.
Nevertheless, the fact that such a vote is taking place illustrates how game theory is influencing the adoption of Bitcoin.
Publicly traded companies are closely observing MicroStrategy’s approach, and the potential benefits for early adopters are significant. Companies that move first stand to gain the most from Bitcoin’s appreciation and network effects, while those that lag behind may miss out on these advantages.
For those interested in understanding why Bitcoin could prevail as a global store of value, studying game theory and reading The Bitcoin Standard offers valuable insights into the economic incentives at play.
LINK
In December, Microsoft shareholders will vote on a proposal to adopt a strategy similar to MicroStrategy’s by holding Bitcoin as a reserve asset.
The board has recommended that shareholders vote against this proposal, and it’s likely that the motion will not pass.
Nevertheless, the fact that such a vote is taking place illustrates how game theory is influencing the adoption of Bitcoin.
Publicly traded companies are closely observing MicroStrategy’s approach, and the potential benefits for early adopters are significant. Companies that move first stand to gain the most from Bitcoin’s appreciation and network effects, while those that lag behind may miss out on these advantages.
For those interested in understanding why Bitcoin could prevail as a global store of value, studying game theory and reading The Bitcoin Standard offers valuable insights into the economic incentives at play.
2
Posted on 10/25/24 at 7:57 am to I Love Bama
While the board is recommending a NO vote on this, it is still interesting nonetheless. I wonder who forced the vote to even occur? Had to be a large shareholder I assume?
Posted on 10/25/24 at 8:02 am to TigerTatorTots
Worth noting that Blackrock is their 2nd highest institutional holder.
I copy and pasted this below from their latest filing.
Proposal 5: Assessment of Investing in Bitcoin (Shareholder Proposal)
National Center for Public Policy Research has advised us that they intend to submit the following proposal for consideration at the Annual Meeting.
Bitcoin Diversification Assessment
Supporting Statement:
In periods of consistent, and often rampant, inflation, a company’s financial standing is unfortunately measured not only by how well it conducts its business, but also by how well it stores the profits from its business.
Corporations that invest their assets wisely can, and often do, increase shareholder value more than more profitable businesses that don’t. Therefore, 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.
The average inflation rate in the US over the last four years according to the CPI – which is a remarkably poor and corrupt measure of inflation – is 5.03%, peaking at 9.1% in June 2022. In reality, the true inflation rate is significantly higher than that, with some studies estimating it to be nearly double the CPI at times. So a corporation’s assets have needed to appreciate at those rates over the last four years just to break even.
As of March 31, 2024, Microsoft Corporation has $484 billion in total assets, the plurality of which are US government securities and corporate bonds that barely outpace inflation (if assuming that the CPI is accurate, which it isn’t, so bond yields are actually lower than the true inflation rate).
Therefore, in inflationary times like these, corporations should – and perhaps have a fiduciary duty to – consider diversifying their balance sheets with assets that appreciate more than bonds, even if those assets are more volatile short-term.
As of June 25, 2024, the price of Bitcoin increased by 99.7% over the previous year, outperforming corporate bonds by roughly 94% on average. Over the past five years, the price of Bitcoin increased by 414%, outperforming corporate bonds by roughly 411% on average.
Microstrategy – which, like Microsoft, is a technology company, but unlike Microsoft holds Bitcoin on its balance sheet – has had its stock outperform Microsoft stock this year by 313% despite doing only a fraction of the business that Microsoft has. And they’re not alone. The institutional and corporate adoption of Bitcoin is becoming more commonplace. Microsoft’s second largest shareholder, BlackRock, offers its clients a Bitcoin ETF.
Bitcoin is a more volatile asset, at the moment, so companies should not risk shareholder value by holding too much of it. However, as Bitcoin is an excellent, inflation hedge against inflation and corporate bond yields are less than the true inflation rate, companies should also not cause value loss by ignoring Bitcoin altogether. At minimum, companies should evaluate the benefits of holding some, even just 1%, of Bitcoin.
Resolved: Shareholders request that the Board conduct an assessment to determine if diversifying the Company’s balance sheet by including Bitcoin is in the best long-term interests of shareholders.
I copy and pasted this below from their latest filing.
Proposal 5: Assessment of Investing in Bitcoin (Shareholder Proposal)
National Center for Public Policy Research has advised us that they intend to submit the following proposal for consideration at the Annual Meeting.
Bitcoin Diversification Assessment
Supporting Statement:
In periods of consistent, and often rampant, inflation, a company’s financial standing is unfortunately measured not only by how well it conducts its business, but also by how well it stores the profits from its business.
Corporations that invest their assets wisely can, and often do, increase shareholder value more than more profitable businesses that don’t. Therefore, 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.
The average inflation rate in the US over the last four years according to the CPI – which is a remarkably poor and corrupt measure of inflation – is 5.03%, peaking at 9.1% in June 2022. In reality, the true inflation rate is significantly higher than that, with some studies estimating it to be nearly double the CPI at times. So a corporation’s assets have needed to appreciate at those rates over the last four years just to break even.
As of March 31, 2024, Microsoft Corporation has $484 billion in total assets, the plurality of which are US government securities and corporate bonds that barely outpace inflation (if assuming that the CPI is accurate, which it isn’t, so bond yields are actually lower than the true inflation rate).
Therefore, in inflationary times like these, corporations should – and perhaps have a fiduciary duty to – consider diversifying their balance sheets with assets that appreciate more than bonds, even if those assets are more volatile short-term.
As of June 25, 2024, the price of Bitcoin increased by 99.7% over the previous year, outperforming corporate bonds by roughly 94% on average. Over the past five years, the price of Bitcoin increased by 414%, outperforming corporate bonds by roughly 411% on average.
Microstrategy – which, like Microsoft, is a technology company, but unlike Microsoft holds Bitcoin on its balance sheet – has had its stock outperform Microsoft stock this year by 313% despite doing only a fraction of the business that Microsoft has. And they’re not alone. The institutional and corporate adoption of Bitcoin is becoming more commonplace. Microsoft’s second largest shareholder, BlackRock, offers its clients a Bitcoin ETF.
Bitcoin is a more volatile asset, at the moment, so companies should not risk shareholder value by holding too much of it. However, as Bitcoin is an excellent, inflation hedge against inflation and corporate bond yields are less than the true inflation rate, companies should also not cause value loss by ignoring Bitcoin altogether. At minimum, companies should evaluate the benefits of holding some, even just 1%, of Bitcoin.
Resolved: Shareholders request that the Board conduct an assessment to determine if diversifying the Company’s balance sheet by including Bitcoin is in the best long-term interests of shareholders.
Posted on 10/25/24 at 8:26 am to I Love Bama
quote:
Worth noting that Blackrock is their 2nd highest institutional holder.
Lol, are you trying to make the jump that Blackrock has some sway in the vote?? Or even would vote yes??
quote:
The National Center for Public Research, a member of Project 2025 argued that bitcoin is an “excellent, if not the best, hedge against inflation,” and that at minimum, companies should invest 1% of its total assets into the cryptocurrency.
Another nothing burger for crypto Bros, that when other activists group purpose similar votes like saving the whales, or sandwiches can only be in triangles. Never makes the news.
But this time to the moon!!
Posted on 10/25/24 at 8:27 am to I Love Bama
LINK
lol, fwiw, I don't think MSFT will be the first Mag to drop. I think it'll be META. Zuck has a lot of voting shares.
lol, fwiw, I don't think MSFT will be the first Mag to drop. I think it'll be META. Zuck has a lot of voting shares.
Posted on 10/25/24 at 8:31 am to TigerTatorTots
quote:
Had to be a large shareholder I assume?
A group of investors usually need at least 2k dollars worth of company stock. Once it's rejected I think it will need like 5% of the vote to be resubmitted
Posted on 10/25/24 at 8:54 am to UltimaParadox
I literally said I don't think it will pass. The fact that it is even a conversation is insane progress for adoption.
Posted on 10/25/24 at 9:06 am to UltimaParadox
quote:Interesting. I have no idea how proposed voting topics work for shareholders. Why isn't there more ridiculous proposed votes on all stocks if any average joe with $2k of stock can make proposals?
A group of investors usually need at least 2k dollars worth of company stock
Posted on 10/25/24 at 9:16 am to TigerTatorTots
quote:
Interesting. I have no idea how proposed voting topics work for shareholders. Why isn't there more ridiculous proposed votes on all stocks if any average joe with $2k of stock can make proposals?
Because it's a formal process and actually requires filling a bunch of paperwork usually with a lawyer involved. If you follow the process nothing really stops people, and there have been absolute ridiculous proposals in the past. But the average Joe usually would not spend the time necessary to file.
decent article on proposing
Posted on 10/25/24 at 9:20 am to I Love Bama
I guess I can appreciate your commitment to proving that bitcoin is going places, but a vote against using bitcoin, doesn't seem like any proof at all that bitcoin will become a commonly received currency.
It's more of a confirmation bias. You see a big company like Microsoft talk about Bitcoin and all of a sudden it's a huge deal.
It's more of a confirmation bias. You see a big company like Microsoft talk about Bitcoin and all of a sudden it's a huge deal.
Posted on 10/25/24 at 9:40 am to I Love Bama
quote:Overton window keeps creeping over.
The fact that it is even a conversation is insane progress for adoption.
Posted on 10/25/24 at 12:07 pm to UltimaParadox
quote:
Lol, are you trying to make the jump that Blackrock has some sway in the vote?? Or even would vote yes??
Who knows how Blackrock will vote but but are you suggesting that they don't have sway in Microsoft shareholder voting?
quote:
Another nothing burger for crypto Bros, that when other activists group purpose similar votes like saving the whales, or sandwiches can only be in triangles. Never makes the news.
But this time to the moon!!
I don't see any poster in this thread suggesting that this proposal will drive BTC price to the moon. I think the suggestion is simply that proposals like this one, which are becoming more commonplace, is a good signal of BTC adoption.
Were you this emotional about BTC ten years ago? Might your level of BTC angst be an inverse signal for BTC adoption?
Posted on 10/25/24 at 12:37 pm to David_DJS
quote:
Who knows how Blackrock will vote
Lol, they will vote with the board per standard operating procedure, if they didn't they would have a lot of questions to answer. What do you expect them to do?
quote:
but but are you suggesting that they don't have sway in Microsoft shareholder voting?
Yes
quote:
Were you this emotional about BTC ten years ago?
You must not post here much, I'm an avid anti crypto poster for many many years
quote:
Might your level of BTC angst be an inverse signal for BTC adoption?
Been almost 20 years and we are still waiting for that use case that will drive adoption. Only thing you got now is number go up
Posted on 10/25/24 at 12:45 pm to TigerTatorTots
you have to hold the 2K of stock for a minimum of three years and the proposals aren't free
Posted on 10/25/24 at 12:58 pm to TigerintheNO
The timing of this article couldn’t be better.
LINK
“ "It’s hard to imagine that some form of game theory won’t play out when one or two central banks come forward to say they’ve followed El Salvador’s lead in holding bitcoin as a reserve asset, especially if one of those countries is the United States,"
LINK
“ "It’s hard to imagine that some form of game theory won’t play out when one or two central banks come forward to say they’ve followed El Salvador’s lead in holding bitcoin as a reserve asset, especially if one of those countries is the United States,"
Posted on 10/25/24 at 4:04 pm to I Love Bama
Posted on 10/25/24 at 4:27 pm to UltimaParadox
quote:
Lol, they will vote with the board per standard operating procedure, if they didn't they would have a lot of questions to answer. What do you expect them to do?
I would expect them to vote in the best interests of their (Blackrock's) shareholders.
quote:
Yes
So the second largest shareholder is inconsequential in a shareholder vote?
quote:
You must not post here much, I'm an avid anti crypto poster for many many years
I rarely post anywhere but the politics board. And it's that emotion I was curious about - "avid anti-crypto".
quote:
Been almost 20 years and we are still waiting for that use case that will drive adoption.
So BTC started with a market cap of zero and it's now, what, $1.4T? At what market cap will BTC magically become "adopted"?
Posted on 10/25/24 at 6:52 pm to David_DJS
quote:The use case is abundantly clear. It’s the greatest store of value ever known to mankind. As far as adoption goes, I’ve adopted some every week for a while now. It’s 1996 and we’re arguing over whether the internet is a fad.
Been almost 20 years and we are still waiting for that use case that will drive adoption.
This post was edited on 10/25/24 at 6:58 pm
Posted on 10/25/24 at 8:53 pm to David_DJS
quote:
would expect them to vote in the best interests of their (Blackrock's) shareholders
You are wrong there, since Blackrock is just the intermediary. Do you even know why Blackrock is the second largest shareholder, based on your opinion being posted you do not.
quote:
BTC started with a market cap of zero and it's now, what, $1.4T? At what market cap will BTC magically become "adopted"?
Market cap is irrelevant, nobody uses Bitcoin for anything besides number go up. Market cap is massively inflated by billions of dollars of completely unbacked stable coins.
There's no magic number, the price is irrelevant. It's hilarious because you guys only value it in which you can cash it in real dollars since it has no real utility b besides being easier to use by criminals
Posted on 10/25/24 at 9:36 pm to UltimaParadox
quote:
You are wrong there, since Blackrock is just the intermediary. Do you even know why Blackrock is the second largest shareholder, based on your opinion being posted you do not.
Honest question because I am uncertain - does Blackrock vote the shares it holds on behalf of its clients?
And as I type that I realize I may have posted "Blackrock's shareholders" - what I should have typed out was "Blackrock's customers" as in people/organizations that buy their financial instruments.
quote:
Market cap is irrelevant
Okay.
quote:
It's hilarious because you guys only value it in which you can cash it in real dollars since it has no real utility b besides being easier to use by criminals
There's about $10T of gold that's held for investment purposes. Does that gold hold that value because it's also used in jewelry and a bit in industrial applications? Or is one of gold's use cases that it's an investible financial asset/store of wealth?
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