MicroStrategy, a prominent player in the bitcoin market, is set to join the Nasdaq-100 Index, according to an announcement made by the exchange operator last Friday. This news follows a remarkable increase in the shares of the firm, which is known for its active investment in bitcoin. The inclusion in the index will take effect prior to the market opening on December 23, as per Nasdaq’s statement.
Typically, a company’s inclusion in this index leads to a rise in its stock price. This is because exchange-traded funds seeking to mimic the performance of the index often buy shares from the newly added company. Alongside MicroStrategy, data analytics firm Palantir Technologies and Taser manufacturer Axon Enterprise have also been added to the Nasdaq-100 Index. On the flip side, companies such as Illumina, Super Micro Computer, and Moderna were removed from the list, as per Nasdaq.
MicroStrategy has seen its shares skyrocket over six times this year, pushing its market value close to $94 billion. The company, which has been a vigorous investor in the world’s largest digital asset, started purchasing and holding bitcoin in 2020 as its software business revenue started to decline. It even holds the title of being the largest corporate holder of the digital currency.
Analysts believe that MicroStrategy’s bitcoin investment strategy to safeguard its reserve assets’ value has made its stock more attractive. This, in turn, has caused its performance to align more closely with that of the cryptocurrency. Market analysts from Bernstein predict that the market will likely focus on including MicroStrategy in 2025, following its inclusion in the Nasdaq-100.
Bernstein’s brokerage also anticipates that the company’s prospects will continue to improve next year. They believe this will result in “more visibility and recognition beyond fresh ETF inflows,” due to the inclusion in the Nasdaq-100. Recent victories for US President-elect Donald Trump have further boosted the cryptocurrency sector’s optimism for relaxed regulatory hurdles.
MicroStrategy appears undeterred by the escalating prices of bitcoin, with management showing no signs of halting its purchases, comfortable with buying in the $95K-$100K range. As of December 8, the company held about 423,650 bitcoins, purchased for roughly $25.6 billion. This investment, based on bitcoin’s previous close, is now worth around $42.43 billion, according to calculations by Reuters.
