Meta Shareholder Requests Board to Consider Bitcoin Treasury

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A stockholder of Meta Corporation has put forward a suggestion encouraging the firm to investigate the possible advantages of adopting Bitcoin within its financial reserves. This proposal emphasizes Bitcoin’s past performance and its potential for being resistant to inflation, as compared to conventional money and securities like cash and bonds.

Meta Shareholder Board to Consider Bitcoin Treasury?

According to the plan, by the last day of 2024, or specifically on December 30, the value of Bitcoin had surged by an impressive 124% compared to the previous year. This growth outperformed the typical returns seen in bond investments.

Over the past five years, Bitcoin’s value has skyrocketed by 1,265%, significantly outperforming bonds, which have only managed a return difference averaging 1,245% less. In light of this news, Bitcoin’s price has rebounded recently, fluctuating between $95,770 at its peak and $92,250 as its lowest point in a single day.

The proposal highlights that approximately $72 billion, or about 28% of Meta’s total assets as of September 30, 2024, consist of cash and cash equivalents. It suggests that due to inflation, these funds could potentially lose value. However, it proposes an innovative strategy: investing a portion of these reserves in Bitcoin. Despite the well-known volatility of Bitcoin, this move could help maintain shareholder value.

Bitcoin Adoption Among Corporations and Institutions

As a crypto investor, I’m excited about the proposal that highlights Bitcoin’s potential transformation from an investment or payment option to a treasury asset for businesses and institutions. Companies like MicroStrategy, who made early investments in Bitcoin, have seen their equity skyrocket by 17,000% thanks to their strategic approach to incorporating BTC into their balance sheets. Similarly, Square (now Block) has outperformed the Nasdaq index by a factor of 2.5 and Meta’s performance by a staggering 12 times. This suggests that Bitcoin could be a valuable addition to any institutional portfolio.

Furthermore, it’s worth noting that BlackRock, one of Meta’s largest institutional investors, recently launched a Bitcoin Exchange-Traded Fund (ETF), which quickly became the most successful ETF ever. On top of this, BlackRock has publicly endorsed an investment strategy that includes 2% allocation to Bitcoin for future-focused investing.

The proposal by Meta’s shareholders suggests that designating funds in Meta’s treasury this way would show forward-thinking financial management and align with the practices of other leading companies.

Support from Meta Leadership and Industry Trends

The proposal indicates that the executives at Meta, along with their associates, have expressed curiosity towards Bitcoin and its associated network. Notably, Mark Zuckerberg, Meta’s founder, and Marc Andreessen, a Meta board member who also holds a position on Coinbase’s board, have previously advocated for blockchain technology and cryptocurrencies.

The shareholder contends that Meta shareholders deserve access to investment plans akin to the advanced financial strategies possibly employed by some of Meta’s board members and executives.

The proposal likewise highlights various organizations and administrations contemplating Bitcoin or currently incorporating it into their reserves. For instance, a bill has recently been presented to the New Hampshire legislature, granting the state treasury the authority to keep Bitcoin alongside precious metals like gold and silver as part of its reserves.

Similarly, companies like Heritage Distilling Holding Company and Genius Group Ltd are similarly adopting Bitcoin. For example, Genius Group Ltd recently invested $5 million in Bitcoins, reflecting their ‘Bitcoin-first’ approach.

Request for Assessment and Fiduciary Duty

The proposal suggests that Meta’s board should examine whether it would benefit shareholders to add Bitcoin to Meta’s reserves. In other words, as part of their fiduciary responsibility, the board is encouraged to look into potential investments that may offer a greater return than traditional assets like cash and bonds, despite potentially higher risks being involved.

Meta, recognized for its technological prowess and innovative business strategies, could further bolster its reputation by being among the early adopters of Bitcoin as a corporation. The shareholder proposes considering Bitcoin as a potential strategic asset, rather than suggesting an immediate action. This discussion centers around exploring the feasibility of such a move.

At the same time, John Deaton – a lawyer specializing in cryptocurrency – has noted that Microsoft shareholders have recently turned down the proposal to invest in Bitcoin, following a similar motion. Deaton added that Meta shareholders could potentially face a similar dilemma. However, he suggested that companies looking forward to legislation that supports Bitcoin adoption, such as the State Bitcoin Reserve (SBR) provisions in the Lummis Bill, might consider Bitcoin as a strategic asset for acquisition.

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2025-01-11 05:34