Amazon Shareholders Advocate for Bitcoin Treasury Strategy

Following in the footsteps of other major corporations, shareholders of Amazon.com Inc. (NASDAQ:AMZN) expressed their desire for the company to explore a Bitcoin (BTC/USD) treasury strategy aimed at enhancing long-term shareholder value.

What Happened: The National Center for Public Policy Research, a think tank based in the U.S. focused on free market principles, has put forth a shareholder proposal that urges Amazon to "conduct an assessment" regarding the possibility of allocating around 5% of its assets into Bitcoin.

The think tank contends that Amazon's strategy of holding a substantial $88 billion in cash and cash equivalents is not sufficient to maximize shareholder returns, especially amidst ongoing economic challenges and currency debasement.

The proposal highlights that the average inflation rate in the U.S. has been around 0.95% over the last four years but suggests that actual inflation rates might be significantly higher than the consumer price index reports.

According to the proposal, "During these inflationary times, companies have a fiduciary duty to enhance shareholder value not just by increasing profits, but by safeguarding these profits against erosion due to inflation," the think tank articulated.

Shareholders also pointed out that Bitcoin has surged by 131% in the previous year, outperforming the average growth of corporate bonds, which stood at 126%.

MicroStrategy Example: Notably, the National Center for Public Policy Research referenced MicroStrategy Inc. (MSTR) as a prime example of corporate Bitcoin adoption, highlighting that its stock has outperformed Amazon's by an impressive 537% in the last year.

Other companies like Tesla and Block were mentioned, as well as Amazon's second-largest stakeholder, BlackRock, known for managing the iShares Bitcoin Trust ETF (IBIT), currently the largest investment fund focused on Bitcoin.

The think tank acknowledges the potential volatility associated with Bitcoin but believes that diversifying Amazon's balance sheet to include a small portion of Bitcoin could help mitigate risks while preserving overall value. "At the very least, Amazon should evaluate the potential advantages of investing 5% of its assets in Bitcoin," the proposal stated.

Importance of the Proposal: This recommendation emerges just ahead of an upcoming shareholder meeting for Microsoft, scheduled for December 10, where a similar proposal regarding evaluating Bitcoin investments will be voted on. As with Amazon’s situation, Microsoft’s proposal also referenced MicroStrategy’s impressive stock performance following its shift toward a Bitcoin strategy. Notably, MicroStrategy's Chairman, Michael Saylor, delivered a brief presentation aimed at Microsoft's board, projecting that adopting a full Bitcoin strategy could lead to a substantial market capitalization increase of around $5 trillion.

Market Activity: At the time of this writing, Bitcoin was trading at $99,447.77, having experienced a slight decrease of 0.93% in the past 24 hours, based on data from Benzinga Pro. Meanwhile, Amazon's shares closed 2.94% higher at $227.03 during the regular trading session on Friday.

Image via Shutterstock

Amazon, Bitcoin, shareholders