Strategy (MSTR), a company heavily focused on Bitcoin, will remain in the Nasdaq 100 index, surviving the annual shake-up that saw several well-known names fall.
The company, which started as enterprise software provider MicroStrategy, pivoted in 2020 toward storing Bitcoin as its primary strategy. Since then, it has accumulated 660,624 BTC worth $59.55 billion and was added to the index last December.
Unlike traditional index companies, Strategy’s performance is closely tied to the price of Bitcoin. Its business model, which involves buying and holding massive amounts of cryptocurrency, has inspired similar moves by smaller companies but has drawn criticism from analysts and index providers.
This criticism has led some analysts to argue that the company acts more like a Bitcoin investment vehicle than a traditional business. The Nasdaq 100 Index focuses on non-financial companies listed on the Nasdaq, meaning that being classified as a holding company would mean it would not be eligible for inclusion.
MSCI, a major index provider, has raised concerns about crypto cash companies like Strategy and is expected to issue a decision in January on whether to exclude them from its benchmarks.
Strategy, which was included in these indexes as a technology company due to its business intelligence activities, responded to MSCI’s proposal to exclude these companies, arguing that they are operating companies and not investment funds.
Nasdaq removed six companies from the index during this year’s rebalancing, including Biogen, Lululemon and Trade Desk. Replacements include Alnylam Pharmaceuticals, Ferrovial and Seagate Technology. The changes come into effect on December 22.
