Strategy Retains Key Index Position Amid Bitcoin Focus Scrutiny

The technology firm Strategy, formerly known as MicroStrategy, has secured its continued inclusion in the Nasdaq 100 index. This decision arrives amidst growing debate over whether its business model—centered on accumulating and holding Bitcoin—resembles a specialized fund more than a conventional tech enterprise. The confirmation provides temporary relief for investors, as removal could have triggered billions in forced selling from index-tracking funds.

Nasdaq's latest quarterly reweighting, effective December 22, resulted in the removal of six companies including Biogen and Lululemon Athletica. New additions featured names like Alnylam Pharmaceuticals and Ferrovial. Strategy's retention demonstrates that its place is not automatic, yet it persists within the prominent tech benchmark for now.

The core controversy stems from the company's primary strategy. Analysts increasingly question if a corporate entity holding vast digital assets belongs in traditional equity indices. Strategy functions as a publicly-traded proxy for Bitcoin exposure, tying its fortunes directly to the cryptocurrency's volatile price movements.

Looming MSCI Review Poses Greater Threat

While the Nasdaq question is settled, a potentially more significant review is underway. Global index provider MSCI is examining how to classify companies with substantial digital asset holdings, with a decision expected by January 15, 2026.

In a detailed 12-page letter to MSCI, Strategy's Executive Chairman Michael Saylor and CEO Phong Le warned that exclusion from its indices would cause "profoundly damaging consequences" and market "chaos and confusion." Analysts at JPMorgan estimate such a move, particularly if followed by other index providers, could precipitate outflows of up to $8.8 billion from the stock.

The leadership appealed for indices to "neutrally and faithfully" represent the next era of financial technology, rather than excluding digital asset strategies from traditional benchmarks due to short-term caution.

Aggressive Bitcoin Accumulation Continues Unabated

Parallel to these regulatory discussions, Strategy continues to execute its core Bitcoin acquisition strategy aggressively. On December 8, the company announced its largest purchase in six months.

Details of the Recent Acquisition:
* Bitcoin Purchased: 10,624 BTC
* Total Spend: Approximately $962.7 million
* Average Price Per Bitcoin: $90,615
* Funding Source: $928.1 million from sales of common stock (MSTR) and $34.9 million from STRD preferred shares.

This purchase brings Strategy's total holdings to 660,624 Bitcoin. The cumulative investment stands at roughly $49.35 billion, for an average cost basis of $74,696 per BTC. At recent prices near $90,000, this hoard is worth approximately $59.5 billion—over 3% of Bitcoin's total maximum supply of 21 million coins.

Share Price Reflects Bitcoin Correlation and Multiple Compression

The stock's performance vividly illustrates its dependence on Bitcoin's price. Shares closed Friday at €150.50, approximately 61% below their 52-week high of €391.80. The stock is down nearly 60% over the past twelve months and about 49% year-to-date.

Should investors sell immediately? Or is it worth buying Strategy?

This weakness mirrors not only Bitcoin's decline from its October peak but also a contraction in the stock's premium. The market cap to net asset value (mNAV) multiple has shrunk significantly, indicating investors' reduced willingness to pay a large premium for the corporate structure atop the underlying Bitcoin holdings.

The technical picture appears challenging: the share price trades below its 50-, 100-, and 200-day moving averages. Meanwhile, the 14-day Relative Strength Index (RSI) reads 84.2, signaling overbought conditions. Combined with a 30-day volatility near 60%, these metrics highlight the stock's extreme short-term swings.

New Dollar Reserve Aims for Stability

To balance its aggressive Bitcoin strategy with financial obligations, Strategy established a new US dollar reserve of $1.44 billion on December 1. Funded via share sales under an "at-the-market" (ATM) program, this reserve is designed to cover dividend payments on preferred shares and interest expenses on outstanding debt.

The company states this reserve is sufficient to service approximately 21 months of dividend and interest commitments. Michael Saylor described the USD reserve as a complement to the existing BTC reserve and a "next step in the evolution" of the model, intended to better cushion short-term market volatility without deviating from the core Bitcoin strategy.

Concurrently, Strategy has revised its fiscal 2025 forecast. The previous year-end Bitcoin price assumption of $150,000 has been lowered to a range of $85,000 to $110,000. Consequently, financial projections have been updated:

• 2025 Operating Result: –$7.0 billion to +$9.5 billion
• 2025 Net Income: –$5.5 billion to +$6.3 billion
• 2025 Diluted EPS: –$17.0 to +$19.0

These unusually wide ranges underscore the extreme dependency of the company's financial metrics on Bitcoin's future price trajectory.

Critical Junctures Ahead: MSCI and Bitcoin's Path

Two primary factors will likely dominate the stock's narrative in the coming weeks and months. First is the pending MSCI decision by January 2026. Inclusion maintains the status quo, while exclusion could trigger substantial index outflows and potentially encourage similar moves by other providers.

Second, the external environment is shifting. Standard Chartered has halved its Bitcoin price forecast for end-2025 from $200,000 to $100,000, citing reduced buying activity from large holders like Strategy. Despite this, the company retains significant funding capacity: approximately $13.45 billion remains available under its common stock ATM program, with over $26 billion in potential preferred and structured issuances. Its first major bond maturity is not until February 2027.

Strategy remains a highly specialized vehicle for betting on Bitcoin's long-term appreciation within the traditional equity universe. It is now partially insulated by a substantial dollar reserve, yet faces decisive index and crypto market tests in the near future.