The self-proclaimed «Bitcoin Development Company» has grow to be one in all the 75 largest non-financial firms on the Nasdaq after its explosive progress this yr.
MicroStrategy (MSTR) will enter one in all the world’s largest exchange-traded funds after turning into the first Bitcoin (BTC)-focused firm to realize entry to the Nasdaq-100 Index.
The Nasdaq-100 Index tracks the 100 largest non-financial firms listed on the Nasdaq exchange and is made up of dominant market names corresponding to Apple (AAPL), Nvidia (NVDA), Microsoft (MSFT), Amazon (AMZN), Meta Platforms (META), Tesla (TSLA), and Costco (COST).
The value of Bitcoin (BTC) rose barely, surpassing $102,000 in the minutes following Nasdaq’s press launch issued on Friday at 8 pm ET, asserting the itemizing.
MicroStrategy’s place in the market
On Nov. 29, the day Nasdaq took a market snapshot to arrange for the index’s annual rebalancing, MicroStrategy had a market capitalization of roughly 92 billion {dollars}. This would place the Michael Saylor-led firm as the fortieth largest on the Nasdaq 100 and give it a possible index weight of 0.47%, in accordance with Eric Balchunas, senior ETF analyst at Bloomberg Intelligence.
By comparability, Apple—previous to this yr’s rebalancing—had the largest weight in the index at slightly below 9%, whereas Qualcomm (QCOM) was in twentieth place with a weight of simply over 1%.
The inclusion will exponentially enhance the Nasdaq 100’s publicity to Bitcoin (BTC), of which MicroStrategy owns roughly $42 billion, and will expose MSTR to billions in passive investments. ETFs that monitor the Nasdaq 100 have greater than $550 billion in belongings underneath administrationin accordance with Balchunas. The largest of those is the Invesco QQQ Trust (QQQ), with over $300 billion in AUM.
Implications for the cryptocurrency market
“MicroStrategy’s inclusion in the Nasdaq 100 is possibly the second biggest news of 2024, after the launch of spot ETFs in the United States. These funds are typically buyers at any price level on a monthly basis, which will add another buyer of MSTR, as Michael Saylor continues to issue ATM to dilute shareholders, but with a larger base of buyers.”
James Van Straten, Senior Analyst at CoinDesk.
James Seyffart, a colleague of Balchunas, notes that MicroStrategy may have a brief keep on the index as the firm depends nearly completely on its Bitcoin holdings and not its precise working enterprise, which may result in its collapse. reclassification as a monetary agency in March. MicroStrategy founder and government Michael Saylor has even beforehand mentioned he plans to show the firm right into a “Bitcoin bank”making it even much less of a technological operation.
“Game theory now sees the SPDR S&P 500 Trust (SPY), the largest of all ETFs with around $650 billion in AUM, possibly needing to include MSTR to compete with its rival. “Millions of investors will now have indirect exposure to Bitcoin, adding to the flywheel effect.”
Van Straten.
The reordering of the Nasdaq 100 and, consequently, the QQQ and associated ETFs will come into drive on December 23.
