As of now, MicroStrategy holds a total of 423,650 bitcoins (accounting for 2.017% of the total bitcoin supply), with a total purchase cost of approximately $25.6 billion and an average purchase price of around $60,324.
Written by: 1912212.eth, Foresight News
Recently, news that MicroStrategy will officially join the Nasdaq 100 index on December 23 has attracted market attention. In recent years, MicroStrategy has been aggressively accumulating BTC with unlimited power, and its chairman Michael Saylor stated earlier this month that the MSTR business has brought approximately 120,000 bitcoins in net profit to its shareholders.
If it can officially join the Nasdaq 100 index, does that mean MicroStrategy's influence will further strengthen and it will have more ammunition to purchase bitcoins?
The Nasdaq 100 Index is a stock index launched by the Nasdaq Stock Exchange, consisting of the 100 largest non-financial companies listed on the Nasdaq. This index reflects the market performance of these companies as a whole and is one of the key indices that global investors pay attention to.
The Nasdaq 100 index does not include companies from the financial industry, such as banks and insurance companies, and is known for being dominated by high-tech companies. The index includes many well-known technology companies such as Apple, Microsoft, and Amazon, with significant representation from the technology and internet sectors.
In addition to the above conditions for inclusion in the Nasdaq 100 index, there are also corresponding requirements for market capitalization, stock liquidity, visibility, and company financial profitability.
Since 2020, MicroStrategy has been using BTC as its main reserve asset. With MicroStrategy's aggressive buying, the strong rise of bitcoin in the new cycle has also driven its stock price up. In January 2023, the MSTR stock price was only $150, but by March 2024, it soared to a peak of $1999.99, with a market capitalization of hundreds of billions of dollars, achieving a stock price return rate of over 1000% in just over a year.
Currently, according to Crypto Briefing reports, the official confirmation announcement may be officially released on December 13. If true, it could significantly enhance MicroStrategy's brand influence and also hold substantial significance for expanding the cryptocurrency industry.
First of all, being included in the Nasdaq 100 index will further enhance investor confidence in MicroStrategy stock, potentially leading to an increase in the company's stock price and attracting more institutional investors' attention.
Bloomberg ETF analyst James Seyffart recently stated that ETFs tracking the Nasdaq 100 index are expected to purchase $2.1 billion worth of MicroStrategy stock, accounting for about 20% of the company's daily trading volume.
The premium issuance of stocks allows MicroStrategy to have more funds to purchase bitcoins, driving up bitcoin prices, thereby enhancing its net asset value and earnings per share.
Secondly, being included in the Nasdaq 100 index helps drive market growth, while the increase in market capitalization in turn encourages MicroStrategy to enter more indices (such as the S&P 500), leading to an increase in related derivatives and trading volume, which reduces MicroStrategy's cost of equity and debt financing, thus lowering the overall debt ratio.
As of December 8 this year, MicroStrategy holds a total of 423,650 bitcoins (accounting for 2.017% of the total bitcoin supply), with a total purchase cost of approximately $25.6 billion and an average purchase price of around $60,324.
For the cryptocurrency industry, the influence of the Nasdaq 100 may also inspire more companies to follow MicroStrategy's lead and join the ranks of bitcoin investors. As more institutional investors enter the cryptocurrency market, the market demand for bitcoin may further increase, driving up BTC prices.
However, some have said there are still uncertainties. Bloomberg analyst James Seyffart commented that whether MicroStrategy (MSTR) can be classified as part of the Nasdaq 100 may depend on its ICB classification. If the company's operational business is software as a service, it would classify it as a tech stock. However, its stock price performance is now largely tied to financial engineering due to its bitcoin purchases.
MicroStrategy Chairman Michael Saylor has stated that he hopes to transform MicroStrategy into a 'bitcoin bank'. If the ICB reclassifies MicroStrategy as a financial stock, it will not qualify for the Nasdaq 100.
The results are expected to be officially announced on December 13, so let's wait and see.
