MicroStrategy Eyes S&P 500 Entry With 91% Chance Bitcoin Stays Above $95,240

MicroStrategy, a prominent business intelligence company, is on the cusp of joining the S&P 500 index, according to an analyst's forecast. The inclusion of MicroStrategy in the S&P 500 would be a significant milestone, as it would signal broader acceptance of cryptocurrencies within the mainstream financial sector. The analyst's forecast is based on the assumption that Bitcoin, the world's largest cryptocurrency by market capitalization, remains stable. MicroStrategy has been a vocal advocate for Bitcoin, holding a substantial amount of the cryptocurrency in its treasury. The company's inclusion in the S&P 500 would be a testament to the growing legitimacy of Bitcoin and other cryptocurrencies as investment assets.

According to financial analyst Jeff Walton, there is a 91% chance that MicroStrategy could qualify for the S&P 500 in the second quarter. The primary requirement for this inclusion is that Bitcoin's price does not fall more than 10% before June 30. Currently, Bitcoin is trading around $106,390. For a company to be included in the S&P 500, it must report positive cumulative earnings over the previous four quarters. MicroStrategy, which holds 592,345 BTC, the largest Bitcoin holding among public companies, has posted net losses for the past three quarters. Walton explained that Bitcoin must stay above $95,240 for the company’s Q2 earnings to outweigh the combined losses from the previous three quarters. A dip below that threshold could disqualify it from meeting the S&P’s earnings requirement.

Walton's forecast is backed by historical Bitcoin price trends. Since September 17, 2014, there have been 3,928 rolling six-day periods. In 343 of those, Bitcoin’s price dropped more than 10%. In the remaining 3,585 times, the decline was less than 10%. As the end of the quarter nears, the chances of a steep drop continue to decline. Walton estimated a 92.4% probability that Bitcoin won’t fall by 10% over five days, increasing to 97.6% over just one day. Despite the strong statistical odds, recent geopolitical events have caused volatility. Over the weekend, rising tensions between Iran and Israel pushed Bitcoin below $100,000 for the first time since early May. If Bitcoin maintains its current level, MicroStrategy would become the second crypto-linked firm to enter the S&P 500 this year. Coinbase joined the index in May, a move crypto industry leaders called a milestone for broader acceptance. MicroStrategy is already a member of the Nasdaq-100 Index, having been added in December 2024. The S&P 500, however, tracks the 500 largest U.S. publicly traded companies and carries significant institutional weight.

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