Block Company Set to Join S&P 500 Index
The fintech company Block is on track to become the first publicly listed company holding Bitcoin (BTC) in its treasury to integrate the S&P 500 Index within the next 21 months, as reported by Matthew Sigel, head of digital assets research at VanEck.
Meeting Criteria for S&P 500 Inclusion
- Exceeding a market cap of $18 billion
- Publicly trading at least 10% of its shares
- Positive GAAP earnings in the most recent quarter
- Positive sum of GAAP earnings over the past four quarters
- High trading volume and liquidity
- Track record of at least 12 months after being listed
- Headquarters in the US
Inclusion in the S&P 500 is not guaranteed and is subject to the decision of the S&P Index Committee, which considers qualitative factors such as sector representation and economic composition.
Historically, it takes 3 to 21 months for a company meeting all the criteria to be added to the index. For example, Lululemon Athletica took up to 65 months for integration, making the timeline for Block uncertain.
Sectoral Dynamics and Market Analysis
The Index Committee emphasizes sector diversification to align with the broader economy. Financials currently account for 13.9% of the S&P 500, indicating there may be room for addition from this sector.
Block currently holds 8,211 BTC, valued over $770 million. The company has been a strong advocate for Bitcoin, with BTC central to its mission.
While Coinbase meets the criteria for S&P 500 inclusion, it is considered a “controversial pick” due to its pure-play crypto exposure, according to Sigel.
