MicroStrategy, led by Michael Saylor, is being considered for inclusion in the S&P 500 index, which could lead to significant investments in the company.
Criteria for Inclusion in S&P 500
According to a Bloomberg report, MicroStrategy (MSTR) theoretically meets the profitability criteria for inclusion in the S&P 500, with a $14 billion unrealized gain last quarter. Inclusion would force passive funds to buy about 50 million of the company’s shares, valued at around $16 billion.
Institutional Validation and Risks
Inclusion in the S&P 500 would provide institutional endorsement for the Bitcoin accumulation strategy, but this model faces skepticism due to the risks associated with using debt financing to acquire BTC. The volatility of MicroStrategy's stock runs at about 96%, which may complicate the committee’s decision for inclusion.
Bitcoin as the Company's Core Asset
MicroStrategy is the leading Bitcoin treasury firm, holding 636,505 BTC valued at over $71 billion. On September 2, the company purchased another 4,084 BTC for about $449.3 million.
Thus, the potential inclusion of MicroStrategy in the S&P 500 would highlight the company's impact on the cryptocurrency market, but questions about the sustainability of its Bitcoin accumulation model remain.
