Key Points
- MicroStrategy Inc, the largest corporate owner of Bitcoin, has seen its profit rise to over $4 billion as Bitcoin’s price surged to nearly $53,000.
- The company’s profit from Bitcoin holdings has doubled from nearly $2 billion in December to over $4 billion.
- MicroStrategy’s co-founder and executive chairman, Michael Saylor, attributes Bitcoin’s recent price surge to the listing of spot Bitcoin Exchange-Traded Funds (ETFs).
- The company plans to rebrand itself as a Bitcoin development company.
- MicroStrategy’s performance this year positions it close to qualifying for inclusion in the S&P 500 Index.
MicroStrategy Inc, the largest corporate holder of Bitcoin, has seen its profit skyrocket to over $4 billion as Bitcoin’s price soared to nearly $53,000.
This significant increase in MicroStrategy’s fortunes testifies to the company’s forward-thinking approach and raises the potential of its inclusion in the esteemed S&P 500 Index.
MicroStrategy’s Bitcoin Holdings and Profit Surge
MicroStrategy’s optimistic view on Bitcoin has been apparent since the third quarter of 2020 when it started amassing the digital asset.
As of the end of January, the company held approximately 190,000 Bitcoin, purchased for a total of $5.93 billion, at an average price of $31,224 per coin, according to its most recent investor presentation.
This strategic investment has proven lucrative, with the company’s profit from its Bitcoin holdings doubling from nearly $2 billion in December to over $4 billion.
This increase is largely due to Bitcoin’s remarkable rally of more than 22% since the beginning of 2024, reaching $52,800 early Thursday morning.
Michael Saylor, MicroStrategy’s co-founder and executive chairman, attributes Bitcoin’s recent price surge to the listing of spot Bitcoin Exchange-Traded Funds (ETFs).
These ETFs have created an imbalance in the supply-demand dynamics, sparking a surge in demand for Bitcoin, especially among retail investors.
MicroStrategy, capitalizing on its success in the Bitcoin market, has announced its intention to rebrand itself as a Bitcoin development company.
Saylor stresses that this strategic move aligns with the company’s mission to accumulate more Bitcoin and contribute to the growth of the Bitcoin network.
MicroStrategy’s Path to S&P 500 Inclusion
MicroStrategy’s impressive performance this year places it close to meeting the criteria for inclusion in the S&P 500 Index.
With a market capitalization of around $12.4 billion, the company is just short of the index’s requirement of $15.8 billion.
The surge in MicroStrategy’s shares, which have risen by 52% over the past month, alongside Bitcoin’s price appreciation, has increased its prospects for S&P 500 inclusion.
Joe Burnett, Senior Product Marketing Manager at Bitcoin financial platform Unchained, commented that MicroStrategy’s entry into the S&P 500 could trigger an influx of demand from passive investors tracking the index, potentially catalyzing a positive feedback loop that benefits both the company and Bitcoin.
While MicroStrategy’s inclusion in the S&P 500 holds immense potential, it is not guaranteed.
The company must meet stringent criteria, including domicile in the United States, sufficient liquidity, and sustained profitability over the previous four quarters.
