How Bitcoin’s Price Surge Could Propel Strategy (MSTR) Toward S&P 500 Inclusion by June 2025

Disclaimer: The analyst who wrote this piece owns shares of Strategy (MSTR). This article explores the potential for Strategy (MSTR) to gain inclusion in the S&P 500 by June 20, 2025, and how Bitcoin’s performance plays a critical role in this journey.

Understanding S&P 500 Inclusion Criteria

To be considered for inclusion in the S&P 500, a company must meet specific criteria, including market capitalization, liquidity, and profitability. Currently, Strategy (MSTR) meets all these requirements except for one crucial factor: achieving positive Generally Accepted Accounting Principles (GAAP) net income over the trailing 12 months. This means that for MSTR to qualify, it must report strong earnings in its Q1 2025 financial statements.

The Financial Accounting Standards Board (FASB) Rule Change

Recent changes by the Financial Accounting Standards Board (FASB) mandate that companies must now recognize their digital asset holdings, including Bitcoin (BTC), at fair value. This rule is monumental for corporations holding cryptocurrencies, as it allows them to reflect price gains directly in their earnings reports. Under the previous accounting guidelines, firms had to report their digital assets at their lowest historical prices, leading to significant impairment losses.

For instance, in the fourth quarter of 2024, Strategy recorded a staggering $1 billion impairment loss, even though Bitcoin’s market price was nearing $94,000. By adopting the new FASB accounting rules, MSTR stands to benefit significantly, as positive price movements in Bitcoin can directly enhance its earnings.

The Holy Grail: Bitcoin Price Target for MSTR

According to Richard Hass’s analysis on X, for Strategy (MSTR) to achieve positive trailing 12-month earnings, Bitcoin must close above $96,337 by March 31, 2025. This target is essential because MSTR reported a net income loss of $671 million in Q4 2024. To offset these losses, the company needs a whopping $1.113 billion in earnings for Q1 2025.

With MSTR’s current treasury holding 478,740 BTC, the roadmap to S&P 500 eligibility hinges on Bitcoin’s performance. If Bitcoin prices remain strong and MSTR continues accumulating tokens, the likelihood of S&P 500 inclusion becomes increasingly feasible.

Analysts Weigh In: Strategy’s Strong Position

Benchmark analyst Mark Palmer has emphasized that MSTR’s adoption of the amended FASB guidance strengthens its case for inclusion in the S&P 500. Over the past four years, the company’s performance has outpaced every other constituent in the index, making its exclusion quite surprising.

“While joining the Nasdaq-100 was significant, the S&P 500 is the holy grail,” Palmer noted. “Inclusion would validate its Bitcoin strategy, as all S&P 500 index funds would hold MSTR shares, thus indirectly exposing investors to Bitcoin.”

Implications of MSTR’s S&P 500 Inclusion

Should Strategy (MSTR) secure a spot in the S&P 500, it would not only enhance the company’s credibility but also attract substantial institutional investment. This could create a bullish cycle, where increased investment leads to greater stability and further adoption of Bitcoin by corporations.

Furthermore, the ripple effect of MSTR’s inclusion would likely elevate Bitcoin’s status as a legitimate asset class. Investors and analysts would have to reassess their views on cryptocurrencies, particularly Bitcoin, as it becomes integrated into mainstream financial markets.

What This Means for Bitcoin Investors

For Bitcoin investors, the potential inclusion of MSTR in the S&P 500 signifies a crucial moment in the evolution of cryptocurrency as an asset class. As more companies follow suit and incorporate Bitcoin into their financial strategies, we could witness a shift in market dynamics. This could lead to increased liquidity, price stability, and broader acceptance among traditional investors.

How to Monitor Bitcoin’s Price Movement

Investors interested in tracking Bitcoin’s price can utilize various platforms and tools. Websites like CoinMarketCap provide real-time data on Bitcoin’s price, market cap, and trading volume. Additionally, cryptocurrency exchanges such as Kraken, Binance, and eToro offer comprehensive trading features for Bitcoin and other cryptocurrencies.

Conclusion: A Transformative Moment for Strategy (MSTR) and Bitcoin

In conclusion, the potential for Strategy (MSTR) to achieve S&P 500 inclusion by June 2025 hinges on Bitcoin’s performance in the coming months. The newly adopted FASB accounting rules present a unique opportunity for MSTR to showcase its profitability, thereby meeting the eligibility requirements for one of the most prestigious stock indices in the world.

As Bitcoin continues to gain traction and acceptance in the corporate world, investors should remain vigilant and informed about market trends. The intersection of cryptocurrency and traditional finance is evolving rapidly, and those who stay ahead of the curve will be well-positioned to capitalize on the opportunities that arise.

Disclaimer: Richard Hass’s original post on X was made before Strategy’s latest Bitcoin purchase. CoinDesk has reached out for updated analysis, including Monday’s acquisition.