Block edges closer to becoming first Bitcoin treasury firm to enter S&P 500

The fintech company Block could be the first publicly listed company holding Bitcoin (BTC) in its treasury to integrate the S&P 500 Index within 21 months, according to Matthew Sigel, head of digital assets research at VanEck.

He highlighted that the firm, founded by Twitter co-founder Jack Dorsey, reportedly satisfied the final hurdle for listing after its strong first-quarter 2024 earnings report.

Sigel explained that a company must meet six primary criteria to fit into the S&P 500. The first is exceeding a market cap of $18 billion, followed by publicly trading at least 10% of its shares.

A company should also present positive GAAP earnings in the most recent quarter and a positive sum of GAAP earnings over the past four quarters. In addition to high trading volume and liquidity, it should have a track record of at least 12 months after being listed and have its headquarters in the US.

However, inclusion in the S&P 500 is not a mechanical process. The decision ultimately rests with the S&P Index Committee, which considers qualitative factors such as sector representation and the broader economic composition.

Moreover, it historically takes 3 to 21 months for a company meeting all the criteria to be added to the index. Sigel highlighted the extreme example of Lululemon Athletica (LULU), which took up to 65 months to integrate the S&P 500, which makes the deadline for a potential Block inclusion uncertain.

MicroStrategy, the publicly traded company with the largest BTC treasury, recently joined the Nasdaq 100 Index after its shares soared over 400% in 2024.