Amazon’s shareholders are currently contemplating the tech giant’s potential investment in Bitcoin, following the precedent set by other leading corporations such as Microsoft and Tesla. The proposal is part of a broader trend as companies increasingly consider the cryptocurrency as a hedge against inflation and a potential tool for boosting shareholder returns.
The call for Amazon to consider Bitcoin investment comes against a backdrop of rising global inflation. Traditional safe-haven assets such as cash and bonds are falling out of favor, while Bitcoin has seen a significant increase in value. In 2024, Bitcoin’s value grew by 131%, a performance that far outstrips that of bonds. Over the past half-decade, Bitcoin has surged by more than 1,200%, leading many to view it as a viable investment alternative.
With Amazon’s assets totaling $585 billion, of which $88 billion is held in cash and bonds, shareholders believe that incorporating Bitcoin into the company’s reserves could serve as a bulwark against inflation. Additionally, it could potentially yield higher returns in the future.
Following the proposal, which has been making waves on social media platform X (formerly Twitter), Changpeng Zhao (CZ), the former CEO of Binance, suggested that Amazon could boost its crypto involvement by accepting such currencies as payment options. “Simple. Accept bitcoin payments?” CZ proposed.
Companies with significant Bitcoin holdings, such as MicroStrategy, have witnessed their stock prices climb. Similarly, Tesla and Block (formerly Square) have both added Bitcoin to their balance sheets, a move that the proposal suggests could be beneficial for Amazon in terms of enhancing shareholder value.
Although Bitcoin is renowned for its volatility, owning a portion of the cryptocurrency could offer Amazon long-term value, even in the face of short-term fluctuations. The proposal suggests that Amazon could initially hold 5% of its assets in Bitcoin.
This move is part of a broader trend as companies increasingly view Bitcoin as a reliable investment option to guard against inflation. Microsoft’s shareholders are set to vote soon on whether to incorporate Bitcoin into their balance sheet.
As Bitcoin gains acceptance among major corporations, it is poised to become a routine aspect of corporate asset management. While Amazon has not yet made a decision regarding the addition of Bitcoin to its balance sheet, the participation of tech behemoths such as Microsoft and Amazon in the discussion indicates that more companies are likely to follow suit.
