Strategy (MSTR), a firm heavily invested in Bitcoin, will remain in the Nasdaq 100 index despite the annual reshuffle that removed several well-known companies.
Originally a business software provider named MicroStrategy, the firm shifted its focus in 2020 to accumulating Bitcoin as its primary strategy. To date, it holds 660,624 BTC valued at $59.55 billion and was incorporated into the index last December.
In contrast to traditional firms within the index, Strategy’s performance closely correlates with Bitcoin’s price. Its model of acquiring and retaining large amounts of cryptocurrency has prompted similar actions by smaller companies, but it has also faced skepticism from analysts and index providers.
This scrutiny has led some analysts to suggest that the firm operates more like a Bitcoin investment vehicle rather than a conventional business. Since the Nasdaq 100 index is comprised of non-financial firms, being classified as a holding company would disqualify it from inclusion.
MSCI, a prominent index provider, has expressed concerns regarding crypto treasury companies like Strategy and is anticipated to announce a decision in January about potentially excluding them from its benchmarks.
Strategy, classified as a tech company due to its business intelligence operations, has responded to MSCI’s proposal for exclusion, asserting that these are operational businesses and not investment funds.
In this year’s rebalancing, Nasdaq removed six companies from the index, including Biogen, Lululemon, and Trade Desk, while adding Alnylam Pharmaceuticals, Ferrovial, and Seagate Technology. These revisions take effect on December 22.
