The market last week had ups and downs.

Everything is booming on the surface, expectations of interest rate cuts are increasing, and Trump's goodwill continues. But the news is that some people are happy and some are worried. First, Google's quantum computer caused panic, and then Microsoft voted to reject the Bitcoin investment proposal, which briefly cooled down the market's FOMO. Mainstream currencies took a stab at it, and altcoins suffered a heavy setback; but on the other hand, MicroStrategy successfully included it last weekend. The Nasdaq 100 Index has once again added fire to the market.

From the current point of view, against the background of the upcoming interest rate cut in December, market sentiment is still high and the price support band is gradually rising. But only from the perspective of technology companies, the path differentiation for Bitcoin continues.

On December 14, according to Nasdaq officials, MicroStrategy (MSTR) has been officially included in the Nasdaq 100 Index, with a capital of more than 98 billion US dollars. The market capitalization becomes the 40th largest company in the Nasdaq 100 Index. Companies added at the same time include data analysis company Palantir Technologies and Taser manufacturer Axon Enterprise, while gene sequencing equipment manufacturer Illumina, AI server manufacturer Super Micro Computer and vaccine manufacturer Moderna have been removed. The new index will be launched in December. It will take effect before the market opens on the 23rd.

In fact, Crypto Briefing reported on the news a few days before the official announcement. reported it, and subsequently triggered a vote on Polymarket on whether the index could be officially included. It is precisely because of this that when this news was confirmed, the market did not rise significantly. Instead, the mainstream currencies fluctuated slightly due to the selling news.

But today, in line with the fundamentals of a high probability of interest rate cuts, the market began to rise as expected, and Bitcoin briefly exceeded 10,600, reaching a new high. , Ethereum also broke through $4,000, and the encryption sector rose across the board. The RWA sector led the way up by 7.23%, and the long-dormant NFT sector also rose by 7.06%.

Why does the Nasdaq 100 Index have such great charm? From the introduction ,The Nasdaq 100 Index was established in 1985 and has a long history. It is the 100 stocks with the largest market value and influence selected by the Nasdaq exchange based on the listed companies in the exchange. The stocks are concentrated in technology, consumer, medical, Industries such as industry and communications are dominated by technology stocks. Unlike the S&P 500 and the Nasdaq Composite Index, the Nasdaq 100 Index only selects non-financial companies and does not include financial institutions among its constituent stocks.

Currently, the index has covered many well-known and well-known technology companies, such as Apple, Microsoft, Google, Amazon, Tesla, Meta, Nvidia, and Intel. In terms of performance, compared with the S&P 500 Index, the Nasdaq 100 Index has doubled its growth rate in the past 10 years and has significant characteristics of high returns and high volatility. This year, affected by the rise of the technology sector, the Nasdaq 100 Index The NASDAQ 100 rose more than 30%.

Since its development, many large investors have favored the index. It is worth noting that the Invesco QQQ Trust Fund and the Nasdaq 100 Index are On a tracking basis, the fund has reached $320 billion. According to a report by Bloomberg analyst James Seyffart, there are about 451 billion US dollars in ETFs around the world that directly track the Nasdaq 100 index. When the index is refreshed, global ETFs will buy at least 22 billion US dollars and buy 19 different stocks. , according to this standard, about $2.1 billion in new funds will flow into MicroStrategy.

It can be seen that although the Nasdaq 100 Index is not as well-known as the S&P 500 and other composite indexes, it still has high visibility and recognition in the traditional financial world. degree, and MicroStrategy, as the first crypto component stock to be included in the index, undoubtedly reflects the continued growing influence of the crypto field. It not only broadens investor channels, but also marks a watershed for crypto companies to enter the traditional financial world. Whether it is for individual stocks or the crypto sector, the inclusion of stock indexes has far-reaching significance.

As for why it can be included in the index, the reason is quite straightforward, market value trumps everything else. The inclusion mechanism of the Nasdaq 100 Index is relatively loose, including ranking among the top 100 by market capitalization and the average daily trading volume of the stock must be at least 200,000 shares, etc., but there are no clear regulations on profitability.

As for MicroStrategy itself, since it started buying Bitcoin in 2020, it has become a crypto enterprise driven by Michael Saylor, the founder of radical crypto supporter Star representative on Wall Street. From a business model perspective, MicroStrategy, which originally started as BI software, now focuses its business entirely around Bitcoin. The company’s valuation model relies on the market value premium rate. It uses equity dilution financing to increase its BTC holdings and increase its BTC holdings per share, thus pushing up the company’s market value. . To put it simply, by designing the allocation ratio between equity and Bitcoin, buying Bitcoin through bonds and selling stocks, and then realizing capital operation through the appreciation of Bitcoin.

Since this year, MicroStrategy has issued more than $6 billion in convertible notes to raise money to buy coins. As of December 8, 2024, MicroStrategy has issued approximately $25.6 billion in It acquired 423,650 BTC at a price of US$60,324 per Bitcoin, making it the listed company that holds the largest number of Bitcoins in the world.

In the context of the rising value of Bitcoin, MicroStrategy has also soared. This year alone, the stock price has risen by more than 500%, soaring to a maximum of $543, with trading volume What’s even more astonishing is that the single-day trading volume once even surpassed NVIDIA and Tesla, the two most popular technology companies. Currently, MicroStrategy’s market value is close to US$98 billion, ranking among the top 100 US listed companies in market value.

The skyrocketing earnings have caused an uproar in the market. The well-known short-selling institution Citron has targeted the institution, believing that its stock price premium is too high, but MicroStrategy is still igniting the market. Strategy follows the craze. This year, Bitcoin mining companies Marathon Digital, Riot Platforms, Core Scientific, Terawulf and Bitdeer have all followed MicroStrategy's lead in purchasing Bitcoin through similar convertible bond financing.

In this context, it is understandable that MicroStrategy, which has great influence, strong money-making effect, high valuation and high market value, is included in the 100 index. As its exposure to traditional investors increases, its stock price is still likely to rise further, which also means that it has more capital to buy Bitcoin. As recently as December 13, the founder also posted a picture suggesting that he would buy Bitcoin. More Bitcoin.

It is worth noting that inclusion in the index has also caused more controversy for this company. For example, Nasdaq clearly requires non-financial companies, and although MicroStrategy bears the name of a technology company, it is completely a Bitcoin investment company that hoards and speculates in coins, or is more similar to a Bitcoin ETF., the founder even threatened that MicroStrategy would become a “Bitcoin bank.”

In response, Michael Lebowitz, portfolio manager at RIA Advisors To put it bluntly, "This is essentially a company that will die without Bitcoin." The financial report indeed shows that, according to its Q3 financial report, the cumulative revenue in the first three fiscal quarters of fiscal year 2024 was US$343 million, and the cumulative revenue in the same period last year was US$372 million. US dollars, a year-on-year decrease of 7.81%, with a cumulative net loss of US$496 million in the first three quarters of fiscal year 2024. From the perspective of software business, Q3 software business revenue was only US$116.1 million, a year-on-year decrease of 10.3%.

But the positive thing is that the FASB fair value accounting rules officially take effect today. Under the rules, companies can record Bitcoin based on the total value-added price, rather than the purchase price, giving crypto companies such as MicroStrategy more room to operate. It is foreseeable that during the financial reporting season in February next year, most crypto companies will have even more impressive performance.

Although doubts exist, the market’s expectations are also further ahead. Due to the nature of the company, MicroStrategy's journey to the 100 Index may not be long-term. Bloomberg analyst James Seyffart said ICB may choose to reclassify MicroStrategy as a financial stock during its next change in March. But after Nasdaq's small goal was completed, the more broad-spectrum S&P 500 became the next milestone that the market hopes MicroStrategy will reach. The S&P 500 is more tolerant in terms of company attributes, but sets a higher threshold for profitability, requiring that the sum of profits for the last four consecutive quarters is greater than zero. Although there is a deviation from MicroStrategy, on the basis of the new accounting standards, The market still has some hope.

This company solved the problem of high premiums, but Microsoft in the other company failed the market. A splash of cold water.

Before MicroStrategy reported that it would be included in the index, on December 11, Microsoft made a final vote on the proposal to "include Bitcoin into the company's balance sheet" . Similar to previous predictions, although Michael Saylor used an exciting three-minute speech to try to persuade Microsoft shareholders to support the decision, expertsIt is still believed that there is no guarantee that investing in cryptocurrency will improve the return of the investment portfolio. In the end, just as the board of directors had previously adopted, Keith Dolliver, Microsoft's deputy general counsel, stated in the webcast of the shareholders' meeting that the proposal was officially rejected.

Based on this case, Amazon’s similar proposal in April will most likely be rejected. Affected by this, Bitcoin once fell below $95,000 at the time. In fact, it's a cliché that for established tech giants with huge amounts of cash on their hands, volatility is a key consideration. Most technology giants adopt conservative and prudent financial strategies when investing, rather than pursuing volatile risk returns. Compared with such gains, strategic acquisitions and continued R&D investment are obviously more in line with the long-term values ​​of technology giants. In addition, technology giants pay more attention to social effects, but the high energy losses caused by crypto-assets such as Bitcoin are contrary to the green concepts advocated by the giants, and may even bring certain regulatory risks. This is why giant companies are unwilling to try one.

It is undeniable that it has become a trend for technology companies to hold Bitcoin. According to data from DL News, around 144 companies hold Bitcoin on their balance sheets to date. However, looking at the attitude of technology companies towards Bitcoin, there is a clear differentiation, which is mainly divided into three paths. One is the radical one, represented by MicroStrategy, which directly builds business around Bitcoin, and most of its imitators are crypto companies; the other is the conservative one. Giants such as Microsoft and Amazon pursue stability and security, take a wait-and-see attitude, and will not get involved easily; and One category is located in the middle, choosing to hold Bitcoin. They all focus on their main business, but their attitudes are also different. They may regard Bitcoin as a part of asset allocation, such as Tesla led by Musk. , SpaceX, Tesri currently holds 9,720 Bitcoins, or they are cooperating to influence the hype for the business. This type is mainly for companies with limited business growth.

But for now, the divergent attitudes of technology companies will not affect the excitement of the market. Although the giants remain cautious, other companies pursuing profits Obviously, the perspective will not be slowed down. After all, the Bitcoin strategy is simple and easy to implement, and it can also obtain rare growth benefits. Broadly speaking, during Trump’s crypto-supportive term, Bitcoin will most likely have the same hype potential as AI in the U.S. stock market, representing a new value-added direction, whether for brand marketing or asset allocation, and Or in order to stabilize the stock price, many companies, especially listed companies whose main business encounters bottlenecks, will not give up easily under the possible growth spiral. Therefore, as the mainstream of encryption evolves, the layout of enterprises will only increase day by day. Even if they are not giants, they still represent a wide range of huge cash flows.

On the other hand, the Trump effect is still continuing. On December 15, Trump once again stated in an interview that he would establish a Bitcoin strategic reserve similar to an oil reserve, and would " The cryptocurrency space is doing some great things.” As expected, the bullish trend in the crypto market will still be quite strong with strong support from the surface. The market has given its vote, and the dense price band of Bitcoin holders is moving from 9.5 US$10,000 rises towards US$100,500