Microsoft Corp.’s (NASDAQ:MSFT) refusal to explore Bitcoin (CRYPTO: BTC) investments dampened the spirits of cryptocurrency enthusiasts who had hoped the tech behemoth's move would drive demand for the leading digital asset.

However, it's worth noting that one of its largest shareholders, State Street Corp. (NYSE:STT), is a known backer of cryptocurrencies and blockchain technology.

What happened: A financial services giant, State Street, managed about $4.7 trillion in assets as of this writing, making it one of the world's biggest asset managers. The firm also manages the SPDR S&P 500 ETF Trust (NYSE:SPY), the world’s largest and arguably the most popular exchange-traded fund.

Aside from traditional finance, State Street has ventured into digital asset investing.

The firm, in collaboration with cryptocurrency-focused financial firm Galaxy Digital, launched ETFs in September last year, including SPDR Galaxy Digital Asset Ecosystem ETF (NASDAQ:DECO), that give investors exposure to companies expected to benefit from the adoption of digital assets and blockchains.

State Street projected recently that demand for cryptocurrency ETFs would surpass that of precious metal ETFs in North America by the end of 2025, placing them just after equities and bonds in the ETF market.

The company was also exploring avenues like asset tokenization and cryptocurrency custody services, according to a Reuters report.

State Street holds about 295.10 million shares of Microsoft, implying a total stake of 3.97%, according to the latest 13F filing.

Microsoft, worth more than $3 trillion, voted down a proposal to consider adding Bitcoin to its balance sheet after the board expressed worries about the asset's volatility. The firm had no exposure to any cryptocurrency-focused ETFs as of this writing.

Price Action: Shares of Microsoft closed 3.19% higher at 401.02 during Wednesday’s trading session, according to data from Benzinga Pro. Meanwhile, State Street Stock closed up 0.92% at $92.54.

Image via Shutterstock

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