Amazon Shareholders Propose Adding Bitcoin To Treasury For ‘Best’ Long-Term Interest, Cite Michael Saylor’s MicroStrategy As Example
By Benzinga
Following in the footsteps of other Wall Street giants, shareholders of online retail giant Amazon.com Inc. (NASDAQ:AMZN) urged the firm Sunday to consider a Bitcoin (CRYPTO: BTC) treasury strategy to enhance shareholder value in the long run.
What happened: The National Center for Public Policy Research, a U.S.-based think tank advocating free markets, submitted a shareholder proposal requesting that Amazon “conduct an assessment” of keeping approximately 5% of its assets in Bitcoin.
The think tank argued that Amazon wasn’t providing enough value to shareholders by simply holding on to its huge $88 billion in cash and cash equivalents in the face of consistent debasement.
The letter said that the average inflation rate in the U.S. was 0.95% in the last four years, arguing that true inflation could be much higher, nearly double the Consumer Price Index.
“Therefore, during inflationary times, corporations have a fiduciary duty to maximize shareholder value not only by working to increase profits but also by working to protect these profits from debasement,” the think tank stated.
The shareholders highlighted that Bitcoin grew 131% over the previous year, outpacing corporate bond growth by 126% on average.
The National Center for Public Policy Research also cited the example of MicroStrategy Inc. (NASDAQ:MSTR), a company that pioneered corporate Bitcoin adoption and whose stock has outperformed Amazon by 537% over the past year.
Examples of Tesla and Block were also underlined, along with Amazon’s second-largest shareholder, BlackRock, which operates the iShares Bitcoin Trust ETF (NASDAQ:IBIT), currently the largest Bitcoin-based investment fund.
The think tank pushed for adding Bitcoin even if it exhibits volatility in the short term.
“Diversifying the balance sheet by including some Bitcoin solves this problem without taking on too much volatility. At minimum, Amazon should evaluate the benefits of holding some, even just 5%, of its assets in Bitcoin.”
Why It Matters: The proposal comes ahead of a Microsoft vote on an assessment of investing in Bitcoin in the upcoming shareholders meeting on Dec. 10.
Like in Amazon’s case, the Microsoft proposal specifically mentioned MicroStrategy’s stock outperformance since pivoting to a Bitcoin strategy.
In fact, none other than MicroStrategy Chairman Michael Saylor made a 3-minute presentation for Microsoft’s board, projecting a $5 trillion market capitalization addition in case of a full embrace.
Price Action: As of this writing, Bitcoin was trading at $99,447.77, down 0.93% in the last 24 hours, according to data from Benzinga Pro. Shares of Amazon closed 2.94% higher at $227.03 during Friday’s regular session.
Image via Shutterstock
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