Malaysia
Singapore
Philippines
Stay connected with BizTech Community—follow us on Instagram and Facebook for the latest news and reviews delivered straight to you.
On 10 December 2024, the crypto world will look forward to an important decision from one of the largest tech companies in the world: Microsoft. Will it allocate some of its assets to invest in Bitcoin, as MicroStrategy has done? This decision will not only affect the fortunes of this giant company but could also be a new milestone in the adoption of Bitcoin by institutional investors.
Microsoft’s Bitcoin Investment Project: The Ongoing Process
Since October 2024, Microsoft has stated that the “Assessment of Investing in Bitcoin ” is one of the important agenda items that will be decided by its shareholders through voting. According to documents filed with the US Securities and Exchange Commission (SEC), the decision on whether Microsoft will start investing in Bitcoin is on the line.
However, the decision took a lot of work. Microsoft’s Board of Directors recommended shareholders reject the proposal. In a document revealed on 24 October 2024, the Board of Directors stated, “We recommend that you reject the following proposals: 4 to 9.” In other words, while the Bitcoin investment proposal has become a conversation topic, internal resistance could still affect the final outcome.
The Rising Legitimacy of Bitcoin: What Could Be Achieved If Microsoft Joins In?
If Microsoft decides to follow MicroStrategy’s lead and invest in Bitcoin, it will further strengthen Bitcoin’s legitimacy. So far, many have questioned Bitcoin’s intrinsic value and validity in the global financial system. However, with more and more well-known companies beginning to recognize its existence, including possibly Microsoft, Bitcoin’s position as a legitimate global asset is increasingly evident.
According to Fahmi Almuttaqin, a crypto market analyst, a major company like Microsoft’s decision to recognize Bitcoin as part of its balance sheet will erase any doubts about Bitcoin’s intrinsic value. This is just like the art of painting that is recognized by more people, such as the Monalisa painting, which will attract the attention of many parties. Similarly, Bitcoin will increasingly be seen as an asset that is popular and legitimate in the eyes of the business world.
In addition, Fahmi also explained that although Bitcoin is currently showing significant price increases, uncertainty remains. If US inflation rises higher than expected or crypto-supportive US government policies are not implemented, this positive trend could be hampered. At the same time, however, large institutional adoption continues to increase, providing a huge boost to the crypto market as a whole.
Advice from Michael Saylor for Microsoft: Why is Bitcoin a Smart Choice?
Michael Saylor, founder of MicroStrategy, has long been a proponent of Bitcoin as a strategic investment. On several occasions, Saylor has proposed to Microsoft, including CEO Satya Nadella, to consider Bitcoin part of the company’s long-term investment strategy.
According to Saylor, Bitcoin is a form of digital capital highly relevant to the technology and economy of the future. He projects that Bitcoin’s market capitalization could reach US$200 trillion within the next 21 years, far surpassing the current market capitalization of around US$1.9 trillion. Saylor argues that investing in Bitcoin is much more profitable than Microsoft’s share buyback policy.
For example, MicroStrategy’s success in investing in Bitcoin is highly visible. Since 2020, MicroStrategy’s shares have surged 3,045%, much higher than Microsoft’s, which only saw a 103% increase over the same period. MicroStrategy now holds around 386,700 Bitcoins, making it the public company with the largest Bitcoin holdings.
Saylor also offers Microsoft various Bitcoin-based investment models, such as “Bitcoin24,” and predicts that this strategy could increase Microsoft’s market capitalization to US$4.9 trillion. He even describes this move as part of the “Crypto Renaissance,” a digital revolution that will change the world.
Effect of Microsoft’s Decision on Institutional Adoption of Bitcoin
Microsoft’s decision to invest in Bitcoin could have a major impact on the institutional adoption of Bitcoin. If Microsoft follows MicroStrategy’s lead, it will be a strong signal for other tech companies and financial institutions to consider Bitcoin in their balance sheets.
Microsoft, with its highly respected reputation in the tech sector, can lead a change in the way companies view digital assets. If the company chooses to invest in Bitcoin, the domino effect that could occur is significant, and it would probably encourage many other large companies to explore similar possibilities.
As positive trends continue to develop in the crypto market, from the Web3 sector to DeFi, the future of Bitcoin is brightening. However, as experts remind us, the adoption of large institutions is a critical factor shaping the future of the crypto market. If large investors, such as Microsoft, do get on board, this will further accelerate the mainstream adoption of Bitcoin and crypto in general.