Bitcoin-heavy firm Strategy (MSTR) will remain in the Nasdaq 100 index, surviving the annual reshuffle that saw several household names dropped.
The firm, which began as business software provider MicroStrategy, pivoted in 2020 to stockpiling bitcoin as its core strategy. It has since then accumulated 660,624 BTC worth $59.55 billion, and it was added to the index last December.
Unlike traditional companies in the index, Strategy’s performance is tightly tethered to bitcoin’s price. Its business model, which involves buying and holding massive quantities of the cryptocurrency, has inspired similar moves by smaller firms but drawn criticism from analysts and index providers.
That criticism has seen some analysts argue the firm acts more like a bitcoin investment vehicle than a traditional business. The Nasdaq 100 index focuses on non-financial firms listed in the Nasdaq, which means being classified a holding company would mean it’s ineligible for inclusion.
MSCI, a major index provider, has flagged concerns about crypto treasury companies like Strategy and is expected to issue a decision in January on whether to exclude them from its benchmarks.
Strategy, which has been included in these indexes as a tech company given its business intelligence operations, has responded to MSCI’s proposal to exclude these companies, arguing these are operating businesses and not investment funds.
Nasdaq dropped six companies from the index in this year’s rebalance, including Biogen, Lululemon, and Trade Desk. Replacements include Alnylam Pharmaceuticals, Ferrovial, and Seagate Technology. The changes take effect December 22.