• S&P 500 committee denies MicroStrategy inclusion despite meeting technical requirements, a major setback for corporate crypto treasury strategies.
  • JPMorgan warns the move signals index providers' reluctance to embrace bitcoin-heavy firms, potentially raising MicroStrategy's cost of capital and prompting wider scrutiny.
  • Investor fatigue grows around the sustainability of crypto treasury models amid weaker issuance and heightened volatility.

MicroStrategy Inc.’s bid for a coveted spot in the S&P 500 has been formally rejected by the index committee, a decision analysts at JPMorgan Chase & Co. describe as a significant blow to the company and the broader movement of corporate crypto treasuries. The business intelligence firm, which holds over 638,460 bitcoin, was passed over in favor of companies including Robinhood Markets Inc., AppLovin Corp., and Emcor Group Inc.

The rejection comes despite MicroStrategy posting a record $10 billion in net income for the second quarter of 2025, a figure massively inflated by new accounting standards that allow the company to book unrealized gains on its bitcoin holdings. According to people familiar with the matter, the S&P committee’s decision was discretionary, reflecting a preference for business model stability and sector balance over firms whose valuations are heavily dependent on cryptocurrency volatility.

Shares of MSTR fell nearly 3% on the news, with some traders fearing a further retreat toward the $300 range. The exclusion means the company will miss out on billions of dollars in passive inflows from funds that track the benchmark index, potentially raising its cost of capital and reducing stock stability. “This is a clear signal that the mainstream financial establishment remains skeptical of the crypto treasury model,” said one analyst who asked not to be identified discussing a sensitive matter. “It’s a question of sustainability and regulatory clarity, not just accounting profitability.”

JPMorgan’s note to clients highlighted that the decision could prompt other index providers to reconsider the inclusion of crypto-linked companies in their own benchmarks. The bank also pointed to growing investor exhaustion, weaker new issuance, and rising risks to the corporate crypto treasury trend. The snub echoes historical delays faced by companies like Tesla Inc., which was also kept out of the S&P 500 for years despite meeting quantitative thresholds.

A spokesperson for S&P Dow Jones Indices declined to comment on the specific decision, reiterating that committee selections are based on a mix of quantitative and qualitative factors. MicroStrategy did not immediately respond to a request for comment. The setback occurs against a jittery market backdrop, with traders also focused on imminent Federal Reserve decisions that could impact the price of bitcoin and related equities.

Correction: An earlier version of this article misstated the quarter in which MicroStrategy reported record net income. It was Q2 2025.