Microsoft Passed On Bitcoin While GameStop Jumped In: Who's Laughing Now?

by Chris Katje Benzinga Staff Writer

Video game retailer GameStop Corporation GME became one of the newest companies to buy Bitcoin BTC/USD for its balance sheet.

The move comes months after the world's largest company Microsoft Corporation MSFT decided not to buy Bitcoin in December.

What Happened: GameStop announced it bought 4,710 Bitcoin in a press release Wednesday. The move follows months of speculation and reports the company was preparing to invest some of its billions of dollars in cash into the leading cryptocurrency.

The company joins the growing likes of MicroStrategy Inc MSTR that wish to have Bitcoin on the balance sheet instead of cash as a hedge against inflation or with the belief that Bitcoin’s price will continue to go up.

MicroStrategy Chairman Michael Saylor has been a vocal Bitcoin supporter and also argued that companies should be adding Bitcoin to their balance sheets.

Saylor gave a brief presentation to Microsoft's board of directors after a shareholder proposal known as "Assessment of Investing in Bitcoin" proposed that the company invest a portion of its cash and/or profits into Bitcoin as a hedge against inflation.

Microsoft's board recommended that shareholders reject the proposal due to the unpredictable price movements of Bitcoin.

Shareholders rejected the proposal, and Microsoft was left with $78.4 billion in cash and no Bitcoin purchases.

Missed Out Profits: While Microsoft shareholders rejected the proposal, the same investors could have watched the company's asset value grow if they had supported the purchase.

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Had Microsoft invested 1% of its $78.4 billion cash balance ($784 million) into Bitcoin at the time, the company could have added 7,978 BTC, based on a high price of $98,270.16 on Dec. 10, 2024.

Today, those Bitcoin would be worth $860,524,073.14 based on a price of $107,862.13 for Bitcoin at the time of writing.

This represents a potential profit of $76.5 million in five months and a gain of 9.8% on the money invested in Bitcoin.

While that sounds like a small amount for a company valued at more than $3 trillion, it's important to remember this is based only on 1% of the company's cash and no additional Bitcoin purchases since the initial December date.

For comparison, while Bitcoin is up 9.8% over the five-month time frame, Microsoft stock is up only 1.8%.

Bitcoin has outperformed Microsoft stock over many time periods, including year-to-date, one-year and five-year returns. Bitcoin is up 15.4% year-to-date, +58.3% in one year and +1,011.7% in five years. Compare that to Microsoft stock, which is up 9.4% year-to-date, +6.5% in one year and +150.0% in five years.

More companies are expected to add Bitcoin to their balance sheets in the coming years. Microsoft may be entering later than others, but it still has time to act before broader corporate and sovereign adoption takes hold.

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