MicroStrategy, the data analytics firm turned major bitcoin investor, will join the prestigious Nasdaq-100 Index before markets open on December 23rd, Nasdaq announced Friday. This move comes after a remarkable six-fold increase in MicroStrategy’s share price this year, propelling its market capitalization to nearly $94 billion.
The inclusion in the Nasdaq-100 is expected to further boost MicroStrategy’s stock price as exchange-traded funds (ETFs) tracking the index purchase shares to mirror its composition. This development underscores the growing influence of cryptocurrency investments on traditional financial markets.
MicroStrategy’s aggressive investment in bitcoin, initiated in 2020 amid declining software revenue, has transformed the company into the largest corporate holder of the digital asset. This strategy, aimed at safeguarding reserve assets, has seemingly resonated with investors, aligning the company’s stock performance with the volatile cryptocurrency market.
Joining MicroStrategy in the Nasdaq-100 are Palantir Technologies (PLTR.O), a data analytics company, and Axon Enterprise (AXON.O), maker of Taser devices. Meanwhile, Illumina (ILMN.O), a gene-sequencing equipment manufacturer, Super Micro Computer (SMCI.O), an AI server maker, and Moderna (MRNA.O), a vaccine maker, will be removed from the index.
Analysts at Bernstein suggest that MicroStrategy’s inclusion in the Nasdaq-100 could pave the way for potential inclusion in the S&P 500 by 2025. They anticipate increased visibility and recognition for the company beyond the immediate influx of ETF investments. Bernstein also expects MicroStrategy’s prospects to continue improving next year.
Bitcoin’s recent surge, fueled in part by hopes of eased regulatory hurdles following the election of U.S. President-elect Donald Trump, has significantly benefited MicroStrategy. The cryptocurrency recently surpassed the $100,000 mark for the first time.
Bernstein analysts note that MicroStrategy’s management remains committed to its bitcoin acquisition strategy, even at current price levels around $95,000-$100,000. As of December 8th, the company held approximately 423,650 bitcoins, purchased for an average price of around $25.6 billion. Based on bitcoin’s previous closing price, this investment is now worth approximately $42.43 billion, according to Reuters calculations.
