MicroStrategy's Bitcoin-Powered Surge Takes It Closer to Nasdaq 100 Doorstep

MicroStrategy, a software company known for its aggressive investment in Bitcoin, has seen its shares skyrocket nearly 500% this year, positioning it as a strong contender for inclusion in the Nasdaq 100 index. With a market capitalization of $90 billion and a significant Bitcoin holding valued at approximately $42 billion, the company is poised for potential gains as the index undergoes its annual reshuffle this week.

Key Takeaways

• MicroStrategy's shares have surged nearly 500% in 2023.
• The company holds 400,000 bitcoins, making it the largest corporate holder of the cryptocurrency.
• A potential Nasdaq 100 inclusion could attract more investment firms.
• The reshuffle announcement is expected on Friday after market close.

MicroStrategy's Rise in the Market

MicroStrategy's remarkable ascent in the stock market can be attributed to its strategic decision to adopt Bitcoin as its primary treasury reserve asset in 2020. This move came as revenue from its software business began to decline, prompting co-founder Michael Saylor to pivot towards cryptocurrency investments.

The company's Bitcoin holdings, which account for over 2% of the total Bitcoin supply, have significantly contributed to its market value. The recent surge in Bitcoin prices, which recently crossed the $100,000 mark for the first time, has further fueled investor interest in MicroStrategy.

Nasdaq 100 Inclusion Criteria

To qualify for inclusion in the Nasdaq 100 index, a stock must meet specific criteria:

1. Rank among the top 100 by market value.
2. Maintain a minimum daily trading volume of 200,000 shares.
3. Not belong to the financial sector.

Given its current market capitalization and trading volume, MicroStrategy appears to meet these requirements, making it a likely candidate for the upcoming reshuffle.

Implications of Nasdaq 100 Inclusion

If MicroStrategy is included in the Nasdaq 100, it could have several implications:

• Increased Visibility: Inclusion in the index would enhance MicroStrategy's visibility among institutional investors.
• Attracting Investment: More investment firms may include MicroStrategy in their portfolios, reflecting the index's composition.
• Indirect Bitcoin Exposure: The addition would provide the Nasdaq 100 index with indirect exposure to Bitcoin, potentially appealing to younger investors interested in cryptocurrency.

Other Candidates for Inclusion

MicroStrategy is not the only company vying for a spot in the Nasdaq 100. Data analytics firm Palantir, which has seen its market value quadruple to $160 billion this year, is also a strong contender. Conversely, companies like Super Micro Computer may face exclusion due to delayed financial reporting, raising concerns about their compliance with Nasdaq's listing standards.

Conclusion

As MicroStrategy continues to ride the wave of Bitcoin's popularity, its potential inclusion in the Nasdaq 100 could mark a significant milestone for the company. With the reshuffle announcement just around the corner, investors and analysts alike are keenly watching to see if MicroStrategy will secure its place among the tech giants of the Nasdaq 100.

Sources

• MicroStrategy's bitcoin-powered surge takes it closer to Nasdaq 100 doorstep, Yahoo.