MicroStrategy, known as the largest corporate holder of Bitcoin, is gradually approaching eligibility for inclusion on the S&P 500 index. This milestone has the potential to revolutionize the landscape, allowing Bitcoin firms to feature in “nearly every portfolio.”
While MicroStrategy needs to meet stringent eligibility criteria and achieve a substantial market cap boost, it has made significant strides. Recent data places the Bitcoin-focused firm at the 535th position among publicly-listed companies in the United States. However, to qualify for the S&P 500 index, it must meet various requirements, including a minimum market cap and profitability benchmarks.
Securing a spot on the S&P 500 necessitates navigating through multiple obstacles. MicroStrategy’s market cap, currently at $12.1 billion, needs to reach $15.8 billion, reflecting a notable price increase. Additionally, the S&P’s executive committee holds the authority to approve the listing, as seen in previous cases like Tesla’s temporary removal.
The potential inclusion of MicroStrategy in the S&P 500 holds immense significance for Bitcoin exposure. It could trigger a significant positive impact across various portfolios, including traditional investment vehicles like ETFs. This move has the potential to infiltrate numerous portfolios, reshaping the investment landscape.
Passive index flows play a pivotal role in driving market dynamics. Inclusion in the S&P 500 would lead to automatic buying, elevating MicroStrategy’s share price and fostering further investment. This process could attract substantial passive flows, contributing to the company’s growth trajectory.
Amidst these developments, MicroStrategy’s founder, Michael Saylor, has announced a strategic shift. The company is transitioning from a business intelligence firm to a “Bitcoin development firm,” underscoring its commitment to the cryptocurrency sector.
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