Jessy, Golden Finance

At 00:30 on December 11, Beijing time, Microsoft shareholders will vote to decide whether to use Bitcoin as an asset allocation for Microsoft. The proposal was put forward by the US conservative think tank Center for Public Research (NCPRP), which recommended that Microsoft evaluate allocating at least 1% of its assets to Bitcoin.

At this annual general meeting of shareholders, shareholders voted on the proposal. The outcome of the vote will be determined by a majority vote of shareholders, not the board of directors. If the proposal passes, Microsoft will need to further evaluate and consider whether and how to include Bitcoin on its balance sheet.

What is the current attitude of major shareholders towards crypto assets?

Attitude of the company's major shareholders

Vanguard Group: The world's second largest asset management spoiler, as of May 2024, is Microsoft's largest shareholder, holding 667.99 million shares of Microsoft stocks, accounting for 8.99% of total outstanding shares.

In the early years, I was cautious and even opposed to cryptocurrency investment, but I recognized the value of blockchain technology.

However, its CEO Tim Buckley, who has a clear anti-cryptocurrency stance, announced in March 2024 that he would retire at the end of the year, and former BlackRock executive Salim Ramji was announced by Vanguard Group as the new executive in May. Salim Ramji was responsible for BlackRock's global iShares business and was an important promoter of BlackRock's launch of Bitcoin spot ETF.

Another detail that may represent a change in the group's attitude is that it submitted an application for a new fund to the U.S. Securities and Exchange Commission (SEC) in May this year, and mentioned digital currencies, columns, etc. in the application documents. Clarifying the definition of digital currency, this is considered by the community as a possible precursor to changing its stance on cryptocurrency.

Furthermore, Vanguard Group holds shares in Bitcoin mining companies.

It is difficult to judge its voting tendency at present, but based on the change in its internal attitude towards virtual currency assets, it can be inferred that there is a certain probability of voting in favor of this vote.

BlackRock: Microsoft's second largest shareholder, holding 546.02 million Microsoft shares in May 2024, accounting for 7.35% of total outstanding shares. BlackRock’s Bitcoin spot ETF has a considerable amount of capital, and its chairman, Larry Fink, is himself a Bitcoin advocate. There is a high probability that they will vote in favor.

State Street Corporation: holds 300.35 million shares of Microsoft stock, accounting for 4.04% of total outstanding shares. It recognizes the potential of blockchain technology. The group does not directly hold encrypted assets, but it has also been involved in the encryption field many times. In 2024, State Street Group will cooperate with Swiss encryption company Taurus to hold encrypted assets for customers. News broke in July 2024 that State Street was developing its own stablecurrency. In June 2024, State Street Global Advisors submitted documents to the U.S. Securities and Exchange Commission, planning to register a crypto fund managed by Galaxy Asset Management. State Street Global Advisors will provide management services for the fund. Earlier in 2021, State Street created a digital finance department focused on cryptocurrencies, central bank digital currencies, blockchain technology and tokenization. In addition, it plans to integrate and upgrade its proprietary electronic trading platform to support crypto assets and other asset classes.

Given that State Street has been actively involved in encryption-related businesses in recent years, there is a certain probability that it will vote in favor.

Attitudes of directors and individual major shareholders

Microsoft Board of Directors: Documents submitted by Microsoft to the U.S. Securities and Exchange Commission on October 24, 2024 Zhong said that the board of directors recommended that shareholders vote against the proposal to "evaluate investment in Bitcoin". The board of directors stated that the company's management has carefully considered the issue of investing in Bitcoin and believes that the proposal is not necessary. Its global financial and investment services team has evaluated a wide range of investable assets to fund Microsoft's continued operations, including Bitcoin. However, after comprehensive consideration, it is believed that it is not appropriate to include Bitcoin as an asset.

Satya Nadella: Chairman and CEO of Microsoft, owns 801,331 Microsoft shares as of May 2024, and is one of Microsoft's largest individual shareholders.

There is no public information showing that it holds virtual currency assets. However, he has a positive attitude towards encryption technology itself. For example, he pays attention to user privacy protection in Microsoft's business. When it comes to the application of homomorphic encryption technology, he also expresses support for key escrow systems. He believes that such solutions may be the best option to take into account privacy in the future. and public safety issues.

Bradford L. Smith: President and Vice Chairman of Microsoft Corporation, holding 570,826 shares of Microsoft stock as of May 2024. There is no public information indicating that it holds crypto assets. It has previously stated that Microsoft is not considering adding Bitcoin to its balance sheet. He also opposed the issuance of digital currencies by private companies in public speeches. He believed that basic tasks such as currency issuance should be undertaken by institutions responsible to the public, rather than a few private institutions, and discouraged Microsoft from participating in the issuance of digital currencies because Microsoft is not a bank. , don’t want to compete with banks.

Katherine Hogan: Microsoft's executive vice president and chief human resources officer, holds 159,764 shares of Microsoft stock. There is no public information on its attitude towards crypto or whether it holds crypto assets.

Reid Hoffman: Founder of LinkedIn, became a director of Microsoft after LinkedIn was acquired by Microsoft in June 2016. He has a more positive and optimistic attitude towards cryptocurrencies. He regards cryptocurrencies such as Bitcoin as technologies with significant transformative potential and believes that they are similar to the early Internet.. He also actively invests in crypto-related projects such as Worldcoin, Bitcoin sidechain Blockstream, etc.

Steve Ballmer: Former CEO of Microsoft, holding approximately 333.25 million shares, is Microsoft’s largest individual shareholder. It has no clear public stance for or against cryptocurrencies. There is also no public information showing whether he personally invested in cryptocurrencies.

Bill Gates: One of the founders of Microsoft, according to relevant reports in 2024, he holds approximately 38.2 million Microsoft shares. Its attitude toward cryptocurrencies in general has undergone a transition from more negative to now relatively neutral. However, there is no public information showing that it holds crypto assets.

Summary:

Currently, Microsoft’s board of directors clearly recommends that shareholders vote against the proposal to invest in Bitcoin. With the exception of BlackRock, the opinions of major shareholders of other companies are not clear enough. However, given that investing in Bitcoin has become a trend among listed companies, Microsoft still has a certain possibility of passing the proposal. If the proposal is passed, if it invests 1% of its total assets as recommended by the proposal, it will spend at least US$780 million to purchase Bitcoin. , such a large-scale capital injection into the market will directly increase the market demand for Bitcoin, and the price of Bitcoin will also rise.