MicroStrategy stock has been a standout performer since 2020, surpassing every company in the S&P 500 index, and driving market excitement for its continued growth. The company, known for its Bitcoin holdings, has experienced remarkable stock price increases over the past four years, according to a report by on-chain intelligence firm Arkham.
In a post shared on X (formerly Twitter) on Oct. 14, Arkham confirmed:
“MicroStrategy has outperformed every company in the S&P 500 since August 2020.”
This milestone came just weeks after the company’s exchange-traded funds (ETFs) reached over $400 million in net assets, fueled by retail investors eager for leveraged Bitcoin exposure, as reported by GlobeNewswire on Sept. 30.
MicroStrategy Continues to Rise
MicroStrategy’s decision to be one of the first publicly traded companies to hold Bitcoin has been a critical factor in its stock performance. According to popular crypto analyst Tyler Durden, this growth could continue. In an X post on Oct. 16, Durden highlighted a key chart, saying:
“The secret Wall Street doesn’t want you to know is – the bigger the grey box, the bigger the bounce.”
Durden’s analysis hints that MicroStrategy could see even more gains in the near future. Over the past four years, MicroStrategy’s stock has surged more than 1,540%, compared to a 111% rise in the S&P 500, based on data from Nasdaq and Vantage. Despite this strong growth, experts suggest that MicroStrategy may not be added to the S&P 500 anytime soon.
Challenges for S&P 500 Listing
One obstacle preventing MicroStrategy’s inclusion in the S&P 500 is its financial performance. To qualify, a company must have been profitable in the most recent year and quarter. Seoyoung Kim, a professor at Santa Clara University, noted that MicroStrategy has struggled with negative net income for most of the past year, except for the fourth quarter of 2023. However, this improvement was not enough to bring the company to overall profitability, according to Kim.
Meanwhile, Metaplanet Inc., a Japanese publicly traded firm, is also making waves with its Bitcoin-related strategies. The company saw a nearly 9% increase in stock price after announcing its plans to roll up its Bitcoin put options. The company replaced its previous strike price of $62,000 per Bitcoin with a new strike price of $66,000, set to mature in December 2024.
Metaplanet’s Bold Bitcoin Strategy
Metaplanet’s bold move in the Bitcoin market has positioned it to benefit from future price movements. By working with QCP Capital, the firm generated an additional net premium of nearly 6 BTC, valued at around JPY 57.9 million. This transaction has increased the company’s total nominal yield on the options to 13.4%, signaling a strong financial outlook.
CEO Simon Gerovich explained that this strategy aligns with the company’s long-term goal of increasing its Bitcoin holdings. As of now, Metaplanet holds 861.387 BTC with an average purchase price of JPY 9,313,428 per Bitcoin. By leveraging this strategy, the company not only enhances its revenue but also positions itself to benefit from future Bitcoin price increases.
Bitcoin’s Price Volatility
While Bitcoin has been highly volatile recently, with significant macroeconomic factors influencing the market, both MicroStrategy and Metaplanet seem confident in their strategies. Bitcoin’s price has surged over 1.05%, reaching $67,519.32, while trading volumes have dropped by 1.84%. Despite the potential risks posed by Bitcoin’s volatility, these companies remain focused on capitalizing on its long-term potential.
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