MicroStrategy Aims for S&P 500 Inclusion as Its Bitcoin Profits Top $4 Billion

MicroStrategy’s stellar performance this year has brought it close to qualifying for the S&P 500.

Just as the price of Bitcoin soared to nearly $53,000, MicroStrategy Corporation (NASDAQ: MSTR), the largest corporate owner of cryptocurrencies, has seen its profits soar from over $10 billion in holdings to over $4 billion.

The dramatic increase in MicroStrategy’s wealth is not only a testament to the company’s vision, but also increases its likelihood of being ranked among the prestigious companies in the S&P 500 index.Kaspa Miner

MicroStrategy’s Bitcoin Holdings and Profits Surge

MicroStrategy’s bullish stance on Bitcoin has been evident since it began accumulating digital assets in the third quarter of 2020. The company’s most recent investor presentation revealed that as of the end of January, MicroStrategy held approximately 190,000 bitcoins, with a total purchase price of $5.93 billion and an average price of $31,224 per bitcoin.

The strategic investment has paid off handsomely, with the company’s profits from its bitcoin holdings doubling to more than $4 billion from nearly $2 billion in December, as bitcoin has risen more than 22 percent since the beginning of 2024. Bitcoin climbed to $52,800 early Thursday morning. However, the price then recovered to trade at $51,909 at the time of writing.

Michael Saylor, co-founder and executive chairman of MicroStrategy, attributed Bitcoin’s recent price surge to the listing of Bitcoin exchange-traded funds (ETFs). These ETFs have created a dynamic imbalance between supply and demand, driving a surge in demand for Bitcoin, especially from retail investors. The participation of prominent institutional investors, such as BlackRock Inc (NYSE: BLK) in the spot Bitcoin ETF space, has further enhanced Bitcoin’s bullish momentum.Bitmain Miner

Embracing its success in the bitcoin market, MicroStrategy has announced plans to reinvent itself as a bitcoin development company, a strategic move that Saylor emphasizes is in line with the company’s mission to accumulate more bitcoins and contribute to the development of the bitcoin network.

Unlike traditional investment trusts, MicroStrategy’s model provides greater flexibility, allowing the company to develop software, generate cash flow, capitalize on the capital markets, and accumulate bitcoins for shareholders while facilitating the expansion of the bitcoin ecosystem.

MicroStrategy’s Path to the S&P 500 Index

MicroStrategy’s stellar performance this year has brought it close to qualifying for the S&P 500. The company’s market capitalization is about $12.4 billion, which is below the index’s market capitalization requirement of $15.8 billion.MicroStrategy’s stock price has risen 52 percent in the past month, and this, coupled with the rise in the price of Bitcoin, has increased the prospects for its inclusion in the S&P 500.

Joe Burnett, senior product marketing manager at Unchained, a bitcoin financial platform, said in a post on X that MicroStrategy’s inclusion in the S&P 500 could trigger an influx of demand from passive investors tracking the index, which could potentially catalyze a positive feedback loop that would benefit both the company and bitcoin.

While MicroStrategy’s inclusion in the S&P 500 has great potential, it is not completely guaranteed. The company must meet stringent criteria, including U.S. registration, sufficient liquidity, and consistent profitability over the past four quarters.