By Medha Singh
(Reuters) – A meteoric rise in MicroStrategy’s (MSTR) shares has made the bitcoin hoarder a possible candidate for the tech-heavy Nasdaq 100 index forward of an annual reshuffle this week.
MicroStrategy’s inventory value as up 6% earlier than the bell on Wednesday.
The loss-making software program firm, an aggressive investor within the extremely unstable cryptocurrency, has seen its shares soar practically 500% this 12 months, taking its market capitalization to $90 billion.
The world’s largest cryptocurrency hit the $100,000 milestone for the primary time final week and has doubled in worth this 12 months. It obtained a giant enhance after Donald Trump’s U.S. election victory as traders anticipate the president-elect to make good on his promise of a crypto-friendly administration.
A Nasdaq 100 inclusion may spur extra features for MicroStrategy, whose bitcoin holding was valued at about $42 billion, as extra funding companies embrace the inventory of their portfolios to precisely replicate the index composition.
For an entry into the index, a inventory listed on the Nasdaq change should rank among the many prime 100 by market worth, have a minimal each day buying and selling quantity of 200,000 shares and never be within the monetary sector. The reshuffle announcement is due on Friday after market shut.
“MicroStrategy appears to verify all of the packing containers to make it into the Nasdaq 100 when it’s reconstituted in December,” stated Artwork Hogan, chief market strategist at B. Riley Wealth Administration.
The potential addition would give the Nasdaq 100 index oblique publicity to bitcoin and will make associated ETFs extra interesting to a youthful investor base, stated Todd Rosenbluth, head of ETF analysis at VettaFi.
Information analytics agency Palantir (PLTR), which has risen four-fold in market worth to $160 billion this 12 months, is one other seemingly candidate for index inclusion.
AI server maker Tremendous Micro Laptop (SMCI) might be among the many ones to be ejected from the index because it has delayed submitting its annual and quarterly reviews. Tremendous Micro CEO Charles Liang stated on Tuesday he was assured the corporate wouldn’t be delisted.
Nasdaq didn’t reply to a Reuters request for remark.
Using on bitcoin increase
MicroStrategy adopted bitcoin as its fundamental treasury reserve asset in 2020 beneath the management of co-founder Michael Saylor as income from its software program enterprise slowed.
The corporate has amassed 400,000 bitcoins, making it the largest company holder of the digital asset. It financed its purchases by a mixture of fairness and debt offers and controls over 2% of bitcoin’s whole provide which is capped at 21 million.