MicroStrategy Rejected from S&P 500
Bitcoin treasury firms face increased scrutiny after MicroStrategy failed to join the S&P 500. JPMorgan analysts called this a “major setback.” It shows traditional markets lack confidence in companies holding large Bitcoin reserves.
JPMorgan said, “The S&P 500 committee’s decision to block MicroStrategy’s inclusion is a major setback for corporate crypto treasuries.” The bank added this reflects hesitation to accept crypto-heavy firms in key market benchmarks.
New Rules and Investor Concerns
Nasdaq has introduced stricter rules for companies holding significant crypto assets. These firms must now get shareholder approval before issuing shares to buy more digital currency.
MicroStrategy previously promised not to issue shares below a 2.5 multiple but dropped this pledge last month. This raised concerns about funding transparency.
Investor fatigue is growing. Bitcoin treasury firms’ share prices have fallen sharply since June. MicroStrategy shares dropped 28% from their June 14 peak of $457.
Japan’s Metaplanet, known as the “Japanese Strategy,” has seen a 72% decline from its all-time high. Equity issuance is slowing, while debt issuance continues at higher risk levels, making fundraising harder.
Market Impact and Outlook
Analyst Eric Balchunas noted that S&P 500 inclusion is a committee decision, not purely rules-based. Some companies like Robinhood have joined the index, but crypto-focused firms remain excluded.
MicroStrategy’s Michael Saylor said the company did not expect inclusion in its first eligible quarter. Still, the rejection adds to challenges for Bitcoin treasury firms trying to regain momentum after months of falling valuations.
The S&P 500 decision highlights skepticism toward Bitcoin-centric business models. Without broader market acceptance, crypto treasury firms may face tougher obstacles ahead.
