Zuckerberg’s Folly: Will Meta Miss the Bitcoin Boat? 🌊🚢

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It has been some years since the house of Strategy, a company bold enough to embrace Bitcoin as its primary treasure, first took that audacious step in the long-ago summer of 2020. Yet, alas, few indeed have followed in their daring footsteps. One is left to ponder, are the coffers of other great houses guarded by more timid souls? 🤔

These treasury reserves, often whispered of as mere “cash reserves,” are the lifeblood held by corporations to meet the exigencies of the moment, those fleeting needs and sudden storms. They are the gold and silver, or their paper equivalent, set aside for short-term obligations and unforeseen disasters. Like a miser’s hoard, but on a grander scale. 💰

The behemoth that is Meta, a veritable giant in the realm of social discourse, sits upon a hoard of some $72 billion in liquid assets. Yet, at their annual gathering, a proposal to even consider Bitcoin as a worthy addition to this treasure was cast aside with a resounding “nyet!” The shareholders, in their infinite wisdom (or perhaps their infinite caution), rejected the notion by a margin of 1,221 to a single, lonely voice. 🗣️

Such a rejection, in truth, is hardly a thunderclap from a clear sky. Despite the whispers and murmurings of corporate Bitcoin adoption, the titans of tech and the mainstream corporations remain as wary as cats in a rainstorm. Even the mighty Microsoft, that other American colossus, turned a cold shoulder to similar entreaties in the winter of 2024. 🥶

Meta’s failed dalliance with Bitcoin, spurned by such an overwhelming majority, does indeed raise a most troubling question: Are these grand institutions truly ready to embrace the crypto revolution, or are they destined to remain forever in the horse-and-buggy era of finance? 🐴

Bitcoin’s Volatility: A Weakness or a Mere Pretext?

Perhaps, dear reader, this is all a grand misunderstanding, a comedy of errors worthy of Gogol himself. It may be that the crypto enthusiasts, in their fervor, have failed to grasp that corporate treasuries are not playgrounds for speculative whims, but rather emergency funds, akin to a well-stocked cellar for a long winter. Aswath Damodaran, a professor of some renown at New York University, suggests as much. 🧐

“I think it is lunacy,” he declared to CryptoMoon, regarding the Meta proposal championed by one Ethan Peck, a Bitcoin advocate. Damodaran, with a dismissive wave of his hand, could not conjure “a semblance of a reason for why this is a good idea.” One can almost see him adjusting his spectacles and shaking his head in disbelief. 👓

Damodaran, it must be noted, has earned a reputation as a crypto skeptic, a veritable Doubting Thomas in the digital age. But even Campbell Harvey, a finance professor from Duke University, who has penned a tome on decentralized finance and generally views blockchain with a favorable eye, poured cold water on the Bitcoin treasury initiative, stating with a shrug to CryptoMoon:

“If Meta investors wish to gamble on Bitcoin, they are free to do so with their own coin. It is not clear what role cryptos play in any treasury function unless the company is doing business in a crypto like Bitcoin.”

Stablecoins, those digital tokens tethered to the steady hand of the US dollar, are a more fitting choice for a treasury reserve, Harvey argues. Bitcoin, in contrast, is a wild stallion, too volatile for the staid and serious world of corporate finance. 🐎

Strategy’s triumph with Bitcoin has, according to Harvey, inspired other companies to leap onto the bandwagon, hoping to emulate their success. Strategy’s stock, MSTR, has indeed seen a meteoric rise since embracing Bitcoin, outshining even the likes of Nvidia, Tesla, Google, and Microsoft. A veritable David among Goliaths! 🥇

“But Strategy has wagered the entire company, transforming itself into an active Bitcoin fund,” Harvey cautions, adding:

“If a company wishes to make a strategic investment in Bitcoin, akin to investing in a promising startup, I see no issue. It is a risky venture, and companies engage in such ventures all the time. Just do not attempt to disguise it as a treasury asset.”

And yet, the Metas of this world often hoard billions in their cash reserves, funds that lie dormant, earning little more than dust. To the eyes of professional investors, this is a sin of the highest order, a squandering of potential. 💰

“Meta is perpetually awash in cash,” David Tawil, president and co-founder of ProChain Capital, lamented to CryptoMoon. “They are always holding cash.” They would be far wiser, he suggests, to allocate a portion to Bitcoin, both for diversification and as a shield against the creeping menace of inflation. 🛡️

James Butterfill, head of research at CoinShares, a digital asset investment firm, revealed to CryptoMoon that a mere 3% allocation to Bitcoin can double a fund’s Sharpe ratio, a metric used to gauge risk-adjusted performance. A tantalizing prospect, indeed! 📈

CoinShares’ own survey, tracking a staggering $1 trillion in assets under management, reveals that the average digital asset allocation has risen to 1.8% in April 2025, a notable increase from the 1% recorded in October 2024. “The pace of adoption is accelerating faster than we had anticipated,” Butterfill exclaimed, with a hint of surprise. 😲

A Sign of Caution, or a Mere Tempest in a Teapot?

Meta’s shareholder vote may indeed reflect a broader sense of unease among mainstream corporate and institutional investors regarding Bitcoin. However, it is crucial to remember that CEO Mark Zuckerberg wields a mighty 61% of Meta’s voting power, rendering this not necessarily a representative sampling of corporate America. 🤔

Stefan Padfield, executive director of the Free Enterprise Project at the National Center for Public Policy Research, confided to CryptoMoon that corporate boards and managers are likely as divided on Bitcoin as are economists and politicians. “It is hardly surprising,” he noted, “that we are witnessing firms—including tech firms—taking divergent stances on the ‘none-some-lots’ spectrum when it comes to Bitcoin.” 🤷

And perhaps, dear reader, there is less here than meets the eye. Padfield added:

“While the proposal merely requests consideration of Bitcoin, it may still be rejected simply because managers and investors do not wish to be told what to do in this space.”

Meanwhile, some of the world’s most formidable asset managers, such as Fidelity and BlackRock, have begun to cast a warmer gaze upon the crypto realm. BlackRock, in fact, recently suggested that investors consider allocating up to 2% of their portfolios to Bitcoin for diversification purposes. A sign of the times, perhaps? 🧐

Bitcoin treasury initiatives have been gaining momentum across the globe. On June 3, Blockchain Group, based in Paris, announced the addition of $68 million in Bitcoin to its corporate treasury. And on June 4, K Wave Media of Korea unveiled plans to raise $500 million to purchase Bitcoin, a strategy they boldly termed a “treasury strategy.” 💰

At least 72 new companies have embraced Bitcoin this year, according to Butterfill, though “many of these moves appear to be driven more by a desire to flatter their stock prices rather than a genuine belief in the long-term value of holding Bitcoin on the balance sheet.” A truly strategic allocation, he emphasized, demands a long-term perspective. 🕰️

But what of those major corporations whose core business lies far removed from the world of crypto and blockchain? Thus far, Tesla stands alone among this group, Butterfill observed, adding:

“Given current trends, it is likely that we will eventually witness a major large-cap company adding Bitcoin to its balance sheet.”

Still, returning to the matter of Meta, the rejection ratio of 1,221:1 was, shall we say, rather emphatic, no? A resounding thud, indeed! 💥

Meta shareholders may have succumbed to an overreaction regarding Bitcoin’s so-called volatility, Butterfill suggested. “Bitcoin has exhibited consistently lower volatility than Meta for over two months now, and this trend holds across the FAANG stocks more broadly,” he revealed. A curious twist, wouldn’t you agree? 🤔

Padfield added, “I am always wary of placing too much weight on low [proxy] vote counts. In this instance, it may simply reflect a desire to avoid being ‘forced’ to consider Bitcoin, rather than a wholesale rejection of Bitcoin itself.” A subtle distinction, perhaps, but one worth pondering. 🧐

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2025-06-10 17:13