Key highlights:
- Strategy holds more Bitcoin than any public company
- Analyst sees 91% chance of S&P 500 inclusion soon
- Approval hinges on volatility and Bitcoin reserve model
Strategy (MSTR) could soon become the next crypto-exposed company to join the S&P 500, the benchmark list of the 500 largest publicly traded U.S. firms. But while its metrics look promising, the final decision rests with the S&P Index Committee.
Why Strategy fits the bill
Market analyst Jeff Walton estimates a 91% probability that Strategy’s stock will be added to the S&P 500 as it nears completion of the eligibility criteria.
- Trading activity: Millions of shares exchanged daily
- Market cap: Over $92 billion (as of writing)
- Profitability: GAAP net income of $5.3 billion over the last four quarters
The company is already part of the Nasdaq 100, another heavyweight index of leading tech firms.
The company holds the 52nd position in the NASDAQ-100 index. Source: TradingView
The Committee has the final say
Even with the numbers on its side, Strategy’s inclusion is not guaranteed.
The S&P Index Committee made up of 10 members who vote by simple majority, can reject a company after a comprehensive review.
Key requirements under S&P Global methodology:
- Market cap above $22.7 billion
- Liquidity ratio of 0.75+
- Minimum trading volume of 250,000 shares per month
- Positive GAAP net income across the last four quarters, with the most recent quarter profitable
Bitcoin exposure
Strategy is the largest corporate holder of Bitcoin, with 636,505 BTC in its wallets (Bitcoin Treasuries). In total, public companies collectively own over 1 million BTC.
But its Bitcoin-heavy strategy could also be a stumbling block. A Bloomberg report flagged concerns about:
- The sustainability of its cryptocurrency reserve model
- High volatility, with 30-day price swings averaging 96%
What it could mean for crypto and markets
The S&P 500 is rebalanced quarterly to reflect market shifts. If Strategy makes the cut, the inclusion would funnel massive passive investment flows from ETFs and index funds into MSTR shares.
This could indirectly tighten the link between Bitcoin and Wall Street portfolios, further legitimizing crypto as part of mainstream finance.
Kraken: Best crypto exchange for security & reliability
- Buy, sell, and trade 400+ cryptocurrencies with industry-leading security
- Spot, Futures & Margin trading – leverage up to 5x for advanced traders
- Earn rewards with staking on top cryptocurrencies
- 24/7 customer support and high liquidity for fast trades
- Regulated in the US with strong compliance and security measures
- 13+ million users worldwide
Get Started on Kraken
Source: https://coincodex.com/article/72721/strategy-sp500-bitcoin/