Like Microsoft, Amazon Faces Pressure to Adopt Bitcoin Reserve... 'Cos MicroStrategy

With Bitcoin surpassing the $100K mark, the leading cryptocurrency simply cannot be ignored. 2024 saw a new wave of institutional money flood into digital assets but as we're closing out the prosperous albeit tumultuous year, Bitcoin is now seeing interest from Web2 giants.

Amazon is the latest corporate behemoth facing pressure to adopt Bitcoin. The National Center for Public Policy Research – the same global think tank that pushed Microsoft to consider Bitcoin – has proposed that Amazon take on the leading cryptocurrency asset as part of its reserves.

Noting that Bitcoin's performance has risen 131% over the past year, the think tank highlighted how the digital asset surpassed bonds by 126%. By using MicroStrategy as an example, the think tank further demonstrated that by increasing their Bitcoin holdings, MicroStrategy's stock price has risen 594% this year, vastly outperforming Amazon's 57%. These percentages currently stand at 611% and 56% respectively.

Amazon shareholders seem to be supportive of the initiative too. "Shareholders request that the Board conduct an assessment to determine if adding Bitcoin to the Company's treasury is in the best long-term interest of shareholders," a shared internal document reads.

In October, the Microsoft board recommended that its shareholders vote against a Bitcoin reserve. Microsoft already “carefully considers this topic,” the board claimed in Securities and Exchange Commission (SEC) filing.

“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."

Urging shareholders to vote against Bitcoin investments resulted in ridicule from the wider crypto community.

"Just like Blockbuster carefully dismissed Netflix," said one snarky commenter on X in response to the news.

"I urge Microsoft's management to consider how dumb they are," said another.

MicroStrategy's Michael Saylor then delivered a Bitcoin adoption strategy to Microsoft's board of directors. Presenting at Microsoft's December 2024 shareholder meeting, Saylor proposed a transformative shift in Microsoft's treasury approach that would allocate $200 billion in capital distributions into Bitcoin holdings.

The move would enhance shareholder value and could drive its share price to $584 per share, creating nearly $5 trillion in shareholder value by 2034, Saylor argued.

Saylor projected a reduction in enterprise value at risk from 95% to 59% and an improvement in annual returns from 10.4% to 15.8%, stating Bitcoin is a superior asset compared to traditional dividends and stock buybacks.

MicroStrategy, which is rebranding itself as a Bitcoin Treasury, purchased a record-breaking $5.4 billion worth of the cryptocurrency last month.

An SEC filing shows that between November 18 and 24, the Tysons Corner, Virginia-based company bought 55,500 tokens with money from a $3 billion convertible note offering and common share sales. 

MicroStrategy is the largest publicly listed corporation holding Bitcoin, with around $38 billion in the digital currency.

Saylor is also urging the US government to ditch gold for Bitcoin. "Dump your gold. Sell all the US gold and buy Bitcoin. You will demonetize the entire gold asset class. And our enemies hold gold in their banks, so their assets would go to zero. Our assets would go to $100 trillion," Saylor recently told Yahoo Finance.

Federal Reserve Chair Jerome Powell recently called Bitcoin a speculative asset comparable to gold rather than a rival to the US dollar. Powell’s stance aligns with an ongoing shift among financial institutions toward embracing Bitcoin as "digital gold." This narrative, previously championed by crypto advocates, gains credibility as Bitcoin outpaces gold ETFs in growth and utility.

Powell also dismissed the notion of a national Bitcoin reserve, a Trump campaign promise, emphasizing the Federal Reserve’s priority to maintain the stability and security of the banking system. He reiterated that cryptocurrencies should not pose a risk to financial health, underscoring a cautious regulatory approach.

The topic of Bitcoin reserves come amid an era of evolving US crypto regulation, with the incoming Trump administration and pro-crypto policymakers like Paul Atkins – slated to take over from Gary Gensler as SEC chair – promising friendlier frameworks.

Elsewhere

Blockcast

In this episode, Takatoshi Shibayama sits down with Jason Choi, general partner at crypto prop shop ⁠Tangent⁠, for a candid exploration of crypto markets. Choi discusses meme coin supercycles, navigating macroeconomic headwinds, and the evolution of project evaluation from speculative hype to real-world traction. 

Previous episodes of Blockcast can be found on Podpage, with guests like Peter Hui (Moongate), Luca Prosperi (M^0), Charles Hoskinson (Cardano), Aneirin Flynn (Failsafe), and Yat Siu (Animoca Brands) on our most recent shows.

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