MicroStrategy co-founder and executive chairman Michael Saylor recently expressed his willingness to provide advisory support to President-elect Donald Trump on crypto matters if requested. In a statement to Bloomberg Open Interest, Saylor mentioned his openness to offering insights on constructive digital asset policy either privately or publicly. He also indicated a potential interest in serving on a Digital Assets Advisory Council if approached.
While Saylor acknowledged meeting with various individuals in the incoming Trump administration, he refrained from divulging further details. This announcement coincides with MicroStrategy’s impending inclusion in the Nasdaq-100 index, alongside Palantir Technologies and Axon Enterprise, replacing Super Micro Computer, Moderna, and Illumina effective December 23.
However, the company’s significant Bitcoin holdings, amounting to 439,000 BTC valued at approximately $45 billion following a recent $1.5 billion acquisition, may pose a challenge to its index position. There is a possibility that MicroStrategy could be reclassified as a financial company during a March review by the Industry Classification Benchmark (ICB), potentially leading to its removal from the Nasdaq-100, which comprises non-financial firms exclusively.
Addressing concerns regarding the reclassification, Saylor emphasized that MicroStrategy’s software division generates substantial operating income, estimated at around $75 million annually. He underscored the company’s diversified revenue streams, stating that while Bitcoin plays a pivotal role in their treasury operations, the software business remains a core component of their operations.
Moreover, Saylor highlighted MicroStrategy’s strategic acquisitions and revealed plans to reassess their capital strategy upon reaching their $42 billion Bitcoin acquisition target by January 2025. The company intends to explore various avenues for capital allocation, with a focus on fixed-income markets to enhance returns for common stock shareholders.
Despite MicroStrategy’s Nasdaq-100 inclusion, its path to the S&P 500 appears challenging due to profitability requirements. However, forthcoming changes in financial reporting standards may bolster the company’s prospects for S&P 500 inclusion. Saylor expressed optimism about MicroStrategy’s future financial performance, projecting significant investment income that could potentially meet the criteria for S&P 500 inclusion in the future.
As MicroStrategy navigates its evolving position in the market, Saylor’s proactive stance on advisory roles and strategic planning underscores the company’s commitment to maximizing shareholder value and staying at the forefront of digital asset innovation.