Conservative Microsoft eyes Bitcoin as MicroStrategy and Nvidia lead

While conservative Microsoft explores Bitcoin investment, MicroStrategy and Nvidia drive crypto innovation

Students of history know that even the most iconoclastic revolutionaries sooner or later become conservatives. The same is true in the technology field. Are these the AI ​​founders who are currently tearing up the rulebook? Are the pioneers of decentralization building the next version of the web? Someday, they too will become legacy companies and continue to compete with emerging innovators.

So when a Silicon Valley aristocrat like Microsoft changes tack and embraces an emerging technology like Bitcoin, everyone needs to sit up and take notice. Next month, the giant software company that has contributed so much to the creation of the modern world will vote on its “rating of investing in Bitcoin” — certainly amid much opposition from its board of directors.

While its staggering $3 trillion valuation can’t be ignored, it’s not Microsoft’s sheer size that makes it so significant. That is, the philosophy of Bitcoin and blockchain directly contradicts the principles of centralization that are the basis of today’s Big Tech monopolies. If Microsoft were to jump into Bitcoin, it would be a tacit admission that the future is decentralized and that even the world’s biggest companies will have to upend their most cherished assumptions.

Let’s not get ahead of ourselves. It’s probably just as likely that Microsoft shareholders will vote to keep Bitcoin off their balance sheet… at least not right now. But the very fact that they are considering it has implications for the entire crypto industry, financial markets, governments, regulators and, in fact, all of us.

move slowly and copy things

Bitcoin’s early years were defined by intense skepticism from financial, political, and corporate elites. This hasn’t stopped risk-takers like MicroStrategy from being proactive and getting started early. Michael Saylor was roundly mocked for his Bitcoin bet, and now the joke is on his detractors. The strategy has been extremely profitable, with MicroStrategy reportedly earning $11 billion in profits from its investments at last count.

An “oil tanker” company with a low risk appetite like Microsoft would never have pivoted so quickly. The question is, why now? Could Microsoft’s slowness, cautiousness, and pick-me-up attitude mean it’s late to the Bitcoin party?

Quite the opposite. Microsoft is a conservative organization, and its considerations regarding Bitcoin are based on (perhaps reluctantly) accepting important geopolitical, macroeconomic, and adoption trends. Bitcoin’s risk profile is changing, thanks in part to forward-thinking companies like MicroStrategy and major financial institutions like BlackRock, not to mention increasing political and regulatory approval for cryptocurrencies and their derivatives. I did.

Although Nvidia does not invest directly in Bitcoin, it has benefited greatly from the cryptocurrency sector, particularly through demand for graphics processing units (GPUs) used in Bitcoin mining. This demand contributed to significant revenue growth for Nvidia. In particular, NVIDIA faced shareholder lawsuits for misrepresenting the extent of its revenue from cryptocurrency mining. The US Supreme Court agreed to hear NVIDIA’s appeal in this case, highlighting the company’s indirect involvement in the cryptocurrency industry.

Meanwhile, blockchain continues to innovate, with layer 2 solutions adding new features on a daily basis and fostering convergence between fiat and cryptocurrency ecosystems. These are just some of the key factors that are transforming Bitcoin from a speculative asset to the foundation of a conservative investment strategy. Microsoft may be classified as a “follower” when compared to MicroStrategy, but it could be a bellwether for other conservative companies.

Regulatory clarity creates confidence

There are many tech entrepreneurs who can relate to President-elect Trump. They see him (like themselves) as a great destroyer. Someone who isn’t afraid to shake things up and shoot first and ask questions later. A coined word that refers to someone who moves quickly and breaks things.

But when it comes to Bitcoin, President Trump is more of a weather vane than a beacon. His position changed with the wind. It wasn’t that long ago that he called it a “fraud against the dollar.” His wholehearted support for Bitcoin may have moved the market toward the long-promised $100,000 milestone just days after the election, but the most important development is that he announced his candidacy. It had already started before it was announced. These took place in the corridors of power, not in financial markets.

You don’t need to be obsessed with Bitcoin to know that Congress (along with other Congresses around the world) is hard at work passing new laws governing crypto and digital assets. This is not the place to discuss them all, but laws like FIT 21 in the US and, of course, the European Union’s Market for Cryptoassets (MiCA), widely regarded as the most ambitious and comprehensive set of regulations in the world. It also includes laws such as Cipher.

The complexity and details of these new regulations are less important than the broader trends they represent. Governments have long struggled with the frightening concept of uncontrollable money and financial networks, but they have finally accepted Bitcoin and blockchain as a fact of life. They are currently developing a roadmap for institutional implementation. All of the momentum is in the direction of regulation that embeds cryptocurrencies within established financial structures. This regulatory clarity creates confidence that even companies like Microsoft are considering putting Bitcoin on their balance sheets.

Safer inside than outside

The entry of conservative companies into Bitcoin will have a significant impact on the trajectory of the currency. Naturally, if skeptics of this size change their minds and add Bitcoin to their national treasury, it would be a huge vote of confidence, increasing the legitimacy not only of the currency but of the entire ecosystem surrounding it.

Of course, it’s not just age and outlook that define Microsoft. There is a balance sheet and the aforementioned valuation. Whales are not that big. If Microsoft were to enter Bitcoin in a big way, it would cause tsunami-sized ripples throughout the market. And don’t forget that the company’s operating system runs on most computers on every desk and in every home (and a fair share of mobile devices, too). Rather than finding ways to add value to both its business and its balance sheet by developing new utilities leveraging cryptocurrencies and blockchain and integrating them into its software empire, Microsoft is simply It is unthinkable to be satisfied with just holding coins.

These are turbulent times for cryptocurrencies, but adoption by “conservative” companies could reduce the impact of retail speculation on prices and usher in a new period of stability. A more stable Bitcoin will likely attract more interest from companies that have previously been reluctant to invest.

No matter which way Microsoft shareholders vote, they must remember that succeeding in business today requires the agility and willingness to constantly reimagine, reinvigorate, react, and reinvent. . Wise words, but unfortunately not mine. A tech buddy from a long time ago, Bill Gates, I think that was his name.

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