Key Points
- The National Center for Public Policy Research (NCPPR) has proposed that Amazon should invest at least 5% of its $88 billion cash reserves in Bitcoin.
- The NCPPR suggests that Bitcoin could serve as a hedge against inflation for Amazon’s corporate treasury.
The National Center for Public Policy Research (NCPPR), a free-market think tank based in Washington DC, has recently put forth a proposal to Amazon. The proposal, made on behalf of Amazon’s shareholders, recommends that the tech behemoth allocate at least 5% of its $88 billion cash reserves to Bitcoin.
Bitcoin as an Inflation Hedge
The NCPPR argues that holding Bitcoin in the corporate treasury could benefit Amazon by serving as a hedge against inflation. The proposal was shared by Tim Kotzman, who explained why Bitcoin is a more advantageous asset than traditional ones like corporate bonds. He highlighted the successful Bitcoin investments made by companies such as Tesla and MicroStrategy.
In the proposal, the NCPPR pointed out that MicroStrategy, which holds Bitcoin on its balance sheet, saw its stock outperform Amazon’s by 537% in the past year. The think tank also noted the increasing adoption of Bitcoin by public companies and institutions. It mentioned that BlackRock and Fidelity, Amazon’s second and fourth largest institutional shareholders, offer their clients a Bitcoin ETF. Furthermore, the US government is speculated to form a Bitcoin strategic reserve in 2025.
Criticism of CPI and Proposal for Bitcoin
The think tank also criticized the calculation of the Consumer Price Index (CPI), currently at 4.95%, calling it a “remarkably poor measure” of actual currency debasement. It suggested that the true inflation rate could be double the reported figure. This, the letter argued, significantly reduces the value of Amazon’s $88 billion in cash and short-term equivalents. To protect shareholder value, it recommended Bitcoin as a strategic hedge against this risk.
Amazon and Microsoft’s Stance on Bitcoin
Amazon has not yet responded to the NCPPR proposal. However, the company has previously shown interest in blockchain technology, especially for its supply chain applications. The NCPPR’s suggestion is part of a larger institutional effort to promote Bitcoin adoption. In October, the think tank made a similar appeal to Microsoft, urging the tech giant to consider Bitcoin as part of its investment strategy.
However, Microsoft advised its shareholders to vote against the proposal, arguing that the company already evaluates “a wide range of investable assets”, including Bitcoin. The NCPPR warned that if Microsoft rejects Bitcoin investments and the cryptocurrency’s value increases significantly, the company could face shareholder litigation. Microsoft shareholders are scheduled to vote on the proposal on December 10.
Following the recent submission of the shareholder proposal by the NCPPR, Amazon’s board of directors will assess it to determine whether to include it in the company’s proxy statement for the upcoming annual shareholders’ meeting. If approved for inclusion, the proposal will be presented to shareholders for a vote during the annual meeting, scheduled for April 2025.
