Key Points
- Michael Saylor, MicroStrategy executive chairman, proposes that Microsoft could significantly increase its valuation by investing heavily in Bitcoin.
- Microsoft shareholders will vote in December on whether to add Bitcoin to the company’s balance sheet.
Michael Saylor, the executive chairman of MicroStrategy, recently presented a detailed proposal on how Microsoft could add a staggering $5 trillion to its valuation. His strategy involves a comprehensive investment in Bitcoin. Shareholders of Microsoft will be voting on this proposal in December, determining whether or not the tech giant should add Bitcoin to its balance sheet.
In a video shared on the first day of December, Saylor passionately encouraged Microsoft to divert its cash flows, dividend payouts, stock buybacks, and debt into Bitcoin as part of its financial strategy. He confidently stated, “If you do that, you’ll add hundreds of dollars to the stock price. You can create trillions of dollars of enterprise value. You can strip away risk from your shareholders. Microsoft can’t afford to miss the next technology wave, and Bitcoin is that wave.”
The Potential Impact of Bitcoin on Microsoft’s Valuation
Saylor further elaborated that if Microsoft were to allocate its entire Treasury, debt, cashflows, share buyback money, and dividends to Bitcoin, it could potentially add up to $584 to the MSFT stock over the next decade. This projection assumes that 1 Bitcoin will be worth $1.7million by the end of 2034.
According to Saylor, this strategy could potentially add an astonishing $4.9 trillion to Microsoft’s valuation. At present, Microsoft is the third most valuable company globally, trailing behind Apple Inc. and Nvidia, with a market cap of $3.18 trillion.
Saylor’s Success with Bitcoin and MicroStrategy
Since the start of 2024, Bitcoin’s price has increased by 120%, with predictions of it soon surpassing $100,000. Concurrently, MicroStrategy’s stock (MSTR) has seen a remarkable 465% increase as the company continues to raise massive funds through stock sales, debt offerings, etc., to acquire more Bitcoins for its balance sheet.
Under Saylor’s leadership since 2020, MicroStrategy has acquired 386,700 Bitcoins at a total cost of $21.9 billion. With Bitcoin’s current trading price at $97,200, these holdings are now valued at approximately $37.6 billion.
Saylor noted the increasing public and political support for Bitcoin, referring to it as a “crypto renaissance”. He also mentioned the pro-crypto approach under the upcoming Donald Trump administration, which he believes will boost Bitcoin investment products launched by top Wall Street firms.
Saylor suggested that Microsoft should be investing $100 billion annually, arguing that it makes more sense to buy Bitcoin instead of buying back MSFT stock. He concluded his pitch by urging Microsoft to evaluate its Bitcoin strategic options and “do the right thing for the world and adopt Bitcoin.”
