Tech giant Microsoft is planning a shareholder vote in December on the prospect of investing in Bitcoin (BTC), despite recommendations against it.
In a new submit Together with the US Securities and Exchange Commission (SEC), Microsoft’s board of directors recommends voting against the idea of investing in the leading cryptocurrency based on market capitalization.
With an official statementThe board notes that the proposal itself is not necessary as the company’s management team has already carefully considered whether or not to invest in the crypto king.
“Microsoft [teams] evaluate a broad range of investable assets to finance Microsoft’s ongoing operations, including assets expected to provide diversification and inflation protection, and to limit the risk of significant economic losses from rising interest rates.
Previous assessments 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.
As the proposal itself notes, volatility is a factor to consider when evaluating cryptocurrency investments for corporate treasury applications that require stable and predictable investments to ensure liquidity and operational funding.
The board further says that since the matter has already been investigated, asking shareholders to vote on this issue is “unjustified.”
In another statement, proponents of the idea say big companies should try to diversify their portfolios as a means to combat inflation.
“As of March 31, 2024, Microsoft Corporation has $484 billion in total assets, the majority of which consists of U.S. Treasury and corporate bonds that barely beat inflation (if we assume the CPI is accurate, which it is not, so bond yields are actually lower than the actual inflation rate).
Therefore, in times of inflation like this, companies should – and perhaps have a fiduciary duty to do so – consider diversifying their balance sheets with assets that appreciate more than bonds, even if those assets are more volatile in the short term.”
Bitcoin is trading at $66,799 at the time of writing, down more than 2% in the past 24 hours.
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Generated image: Midjourney