Author: Daniel Ramirez-Escudero, CoinTelegraph; Translated by: Deng Tong, Golden Finance.

Large technology companies like Amazon have a substantial amount of Cash on hand - $87 billion last year - and this cash is losing purchasing power.

The Washington D.C. think tank National Center for Public Policy Research (NCPPR) has submitted a shareholder proposal to adopt Bitcoin as a solution. However, it is still unclear whether technology giants will benefit from this.

NCPPR has been promoting this Global Strategy with Microsoft and Amazon. In both cases, the think tank believes incorporating Bitcoin into their treasury would protect Cash Assets and Shareholder value from inflation.

The proposal states that setting the inflation rate at 4.95% based on the Consumer Price Index (CPI) is a "very poor indicator" of real currency depreciation, and suggests that the actual inflation rate could be double that.

Cash on hand for Microsoft and Amazon from 1996 to 2024. Source: Companiesmarketcap.

Microsoft has $78 billion in Cash on hand, while Amazon has $87 billion. While Bitcoin may provide a potential hedge, is the risk greater than the reward?

Despite support from orange pill expert and chairman of the business intelligence company MicroStrategy, Michael Saylor, Microsoft shareholders overwhelmingly voted against the NCPPR's proposal for Bitcoin reserves, indicating that its perceived volatility is a negative factor.

Amazon will make a decision next. Will this vote be any different?

Amazon is not like Microsoft; it is not a conservative technology company.

Nick Cowan, CEO of the fintech company Valereum, pointed out that while Microsoft and Amazon may share similarities as technology giants, their styles are completely different.

"As Amazon has a reputation for innovation and risk tolerance, its shareholder vote may indeed differ from Microsoft's."

While Microsoft has traditionally been conservative in its financial and strategic policies, Amazon has a good track record in adopting emerging technologies and exploring novel investments.

"Unlike Microsoft, Amazon's greater willingness to innovate may align with the diversification potential of Bitcoin," Cowan said.

Amazon might vote on the NCPPR proposal at the annual shareholder meeting in May 2025. The proposal urges the company to allocate a higher proportion of risk assets in its corporate investment portfolio than the typical 1-2%.

"At the very least, Amazon should evaluate the benefits of holding a portion of its assets (even if it's just 5%) in Bitcoin."

Cowan believes the likelihood of this ratio is very small. He states, "For a company the size of Amazon, allocating 5% to Bitcoin is ambitious and possibly unrealistic. Although Bitcoin offers diversification, its volatility and lack of tangible returns make it challenging to justify at such a level." He believes that "a smaller-scale experimental allocation similar to Tesla's approach may gain more support from shareholders."

Tesla purchased Bitcoin in 2021, resulting in significant profits for the company. Initially, Tesla bought $1.5 billion worth of Bitcoin but sold 70% of its initial position.

Nevertheless, according to data from BitcoinTreasuries.NET, Tesla still holds its Bitcoin reserve (9,720 BTC), valued at over $1.3 trillion.

Amazon has billions of dollars in available cash, so it could easily allocate a similar amount of cash to Tesla.

While NCPPR may sincerely hope that Amazon and Microsoft adopt Bitcoin, Cowan states that a broader strategy is to amplify the narrative of Bitcoin being viewed as an inflation hedge, creating potential momentum for institutional acceptance of Bitcoin.

Do tech giants need Bitcoin as their treasury?

MicroStrategy has made significant strides in integrating Bitcoin into its financial core strategy.

The company began purchasing Bitcoin on August 12. On December 11, 2020, it acquired 21.454 BTC for $0.25 billion. Since then, its stock price soared from $14 to $411, and its Market Cap increased from $1.3 billion to nearly $100 billion.

Michael Saylor's bet on using Bitcoin as an inflation hedge far exceeds expectations, so why don’t tech giants follow Saylor's financial model?

However, MicroStrategy's approach is noticeably different as it uses significant leverage, making its strategy riskier than Tesla's Buy and Hold strategy.

MicroStrategy's Market Cap history from 1998 to 2024. Source: Companiesmarketcap.

Additionally, the ratio of Bitcoin to its total Market Cap transforms its Stocks into leveraged Bitcoin proxies.

According to the article, Amazon's Market Cap is $2.4 trillion, while Microsoft's Market Cap is $3.3 trillion, so its Bitcoin adoption effect is different from MicroStrategy.

Cohen believes Amazon is not in a hurry to adopt Bitcoin since its 'core business is very strong.' While reallocating part or all of its Cash / Money Market reserves to Bitcoin can hedge against inflation, deviating from the current financial strategy carries risks, and some Shareholders might see it as a potential liability to its profitable business model.

'The opportunity cost of holding volatile assets like Bitcoin instead of investing in R&D or acquisitions will significantly affect this decision.'

He stated, 'Investing a significant amount of funds into Bitcoin may undermine Amazon's ability to fund key growth areas like AWS, AI advancements, and Logistics infrastructure.' Shareholder voting decisions need to 'balance speculative asset acquisition with key innovation investments that define Amazon's competitive advantage.'

The reputation issue of Bitcoin may hinder shareholders.

Large technology companies must also consider public perception, as mainstream media greatly influences their brand and stock price. Although Bitcoin's reputation has significantly improved, it is still associated with speculative trading assets, potential abuses, and environmental issues.

"Negative public relations narratives may overshadow potential economic benefits, especially considering Amazon's focus on ESG initiatives and the need to maintain broad appeal among stakeholders."

Amazon has completely changed the business model by quickly delivering commodities to customers' doorsteps. However, according to a 2022 report by the environmental organization Oceana, the environmental impact of this model is staggering, producing over 0.709 billion pounds of plastic waste.

The company has committed to achieving net-zero carbon emissions by 2040, ten years ahead of the Paris Agreement's target.

Bitcoin's high energy consumption during the mining process has been severely criticized by environmentalists. However, circumstances are changing as mining infrastructure undergoes more thorough scrutiny. Despite this shift, the risk of strong public relations opposition remains.

Amazon shareholders must decide whether the company can achieve positive results similar to Tesla or MicroStrategy by using Bitcoin to hedge against inflation, or if it should avoid risks and focus on its core business model.