MicroStrategy's attempt to join the S&P 500 was denied despite meeting eligibility criteria, indicating a cautionary approach from index committees towards companies heavily invested in Bitcoin. JPMorgan analysts warn that this rejection could lead other index providers to reconsider the inclusion of Bitcoin-centric firms in their benchmarks, straining the corporate treasury model. MicroStrategy’s absence might mark the apex of Bitcoin’s indirect inclusion in traditional investment portfolios, as the adaptability of companies using their balance sheets to hold Bitcoin comes under scrutiny. Furthermore, the firm has waived its no-dilution promise, suggesting a readiness to issue shares at reduced valuations for further Bitcoin acquisitions. As equity and debt fundraising declines, there are growing concerns over the sustainability of the corporate Bitcoin treasury model, with a shift towards financing methods like Bitcoin-backed loans potentially skewing investor sentiment away from pure Bitcoin-holding entities. The current trend may encourage a preference for firms that intertwine crypto operations with their primary business, such as exchanges and miners.

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