MicroStrategy (NASDAQ:MSTR) Chairman Michael Saylor is a famous Bitcoin (BTC-USD) bull. You don’t have to be famous, but you’ll definitely need to be a Bitcoin believer if you intend to buy and hold MicroStrategy stock.

Granted, MicroStrategy isn’t just a Bitcoin-hoarding company. It also has a legacy software business, which we’ll definitely address in a moment. That being said, there’s an important cryptocurrency-related reason to invest in MicroStrategy now, so stay tuned for the details on that.

Is MicroStrategy an AI Company?

Setting aside the crypto connection for a moment, MicroStrategy actually has an artificial intelligence angle that you may have overlooked. This AI angle was on full display at the recent MicroStrategy World 2024 event.

Here’s the scoop. According to a press release, MicroStrategy featured its Auto Express software at the event. This is the trial version of MicroStrategy’s Auto software, a bot that allows users to “embed data-driven AI assistants into any application, anywhere they are needed, to leverage any data.”

MicroStrategy claims that “the majority of” the event’s attendees “built an AI bot” with Auto Express. If that’s the case, then it sounds like this software program is easy to use.

Prospective investors will want to keep tabs on Auto Express as it could prove to be a significant revenue generator for MicroStrategy. Along with that, MicroStrategy may present itself as an AI-software provider to a variety of businesses.

This Weird Problem Could Catalyze MicroStrategy Stock

MicroStrategy could make headway as an AI-software business in 2024, but let’s be completely honest. Under Saylor’s guidance, MicroStrategy has primarily become a relentless Bitcoin-holding business.

This might not be objectionable to you, especially if you’re strongly bullish about Bitcoin. You’ll definitely want to keep track of the latest crypto-related events, however, if you’re a buyer and holder of MicroStrategy stock.

One important event is, of course, the Securities and Exchange Commission’s approval of spot Bitcoin exchange-traded funds. This event prompted some cryptocurrency aficionados to wonder whether the SEC would soon approve some spot Ethereum (ETH-USD) ETFs.

TD Cowen analyst Lance Vitanza believes that this won’t happen anytime soon, and he’s probably right. Oddly enough, the SEC’s likely rejection of spot Ethereum ETFs in 2024 could be a boon for MicroStrategy. Follow along as Vitanza lays out his argument:

“This is significant because while Ethereum’s fate may remain up in the air until 2025 or longer, we believe there’s a substantial amount of capital waiting for a digital winner to be declared; to the extent Bitcoin proves to be that winner, the incremental demand would likely be felt even more acutely given the recent bitcoin halving,” he wrote.

To sum it up, the market is enthusiastic about Bitcoin this year because of the halving event and because of the SEC’s approval of spot Bitcoin ETFs. If the SEC rejects spot Ethereum ETFs in 2024, this would prompt cryptocurrency investors to divert their capital toward Bitcoin.

And that would benefit MicroStrategy, since the company holds massive amounts of Bitcoin, not Ethereum. Vitanza’s argument might sound strange at first, but it makes sense if you really think about it.

Answer This Question Before Buying MicroStrategy Stock

There are some billion-dollar questions pertaining to MicroStrategy. Can the company successfully present itself as an AI-software business? Will regulatory setbacks for proposed spot Ethereum ETFs prove to be a tailwind for Bitcoin and MicroStrategy?

Here’s a more pressing question that any prospective MicroStrategy investor must answer: How bullish are you about Bitcoin? If you’re not very bullish, then you shouldn’t consider buying MicroStrategy stock.

After all, MicroStrategy is currently a Bitcoin-holding company. So, if you expect Bitcoin to gain value over the long term, feel free to buy a few MicroStrategy shares today.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.