(Reuters) – MicroStrategy will be added to the high-tech Nasdaq-100 index, the stock exchange company said on Friday, following a rapid rise in shares of bitcoin buyers.
Nasdaq said the change takes effect before the market opens on December 23.
Inclusion in the index usually boosts the stock price, as exchange-traded funds looking to replicate the index’s performance buy shares of the newly listed company.
Data analysis company Palantir Technologies and Taser device maker Axon Enterprise were added to the Nasdaq-100 index alongside MicroStrategy. Nasdaq said that Illumina, a maker of genetic sequencing equipment, Super Micro Computer, a maker of artificial intelligence servers, and Moderna, a vaccine maker, were removed.
MicroStrategy, an aggressive investor in the world’s largest cryptocurrency assets, has seen its shares rise more than six-fold this year, pushing its market capitalization to nearly $94 billion.
The company began buying and holding bitcoin in 2020 as revenues from its software business dwindled. It is now the largest holder of the cryptocurrency.
Analysts said MicroStrategy’s decision to buy bitcoin to protect the value of its reserve assets has boosted the appeal of its shares, which tend to align with the cryptocurrency’s performance.
Bernstein analysts expect the market will likely set its sights on MicroStrategy’s S&P 500 listing in 2025 after the Nasdaq-100 listing.
The brokerage also sees the company’s prospects continuing to improve next year, adding that it expects “more visibility and recognition beyond new ETF inflows”, as a result of the Nasdaq 100 inclusion.
Bitcoin has soared in recent weeks as US President-elect Donald Trump’s victory raised hopes for the cryptocurrency sector in easing regulatory barriers. Earlier this month, the digital asset jumped above $100,000 for the first time.
“Management has shown no signs of slowing (bitcoin buying) and is comfortable buying bitcoin in the $95,000 to $100,000 range,” Bernstein analysts said.
The company owns approximately 423,650 bitcoins purchased for approximately $25.6 billion based on the average purchase price as of December 8. The investment is worth about $42.43 billion, based on Bitcoin’s previous close, according to Reuters calculations.
(Reporting by Manya Saini and Rishab Jaiswal in Bengaluru; Editing by Pooja Desai, Sam Holmes and William Mallard)