Strategy Opposes MSCI Plan to Exclude Bitcoin Firms from Indexes

The core of the dispute centers on MSCI’s proposed eligibility criterion that would exclude companies classified as Digital Asset Treasuries (DATs) if more than 50% of their balance sheet is composed of digital assets like Bitcoin. In a letter signed by Executive Chairman Michael Saylor and CEO Phong Le, Strategy acknowledged MSCI’s goal of consistent criteria but labeled this specific threshold as “misguided.” The company contends that this rule creates a uniquely unfavorable condition for digital asset firms that is not applied to other sectors with concentrated asset holdings.

Strategy draws a direct comparison to real estate investment trusts (REITs), oil companies, and timber firms, which often maintain significant concentrations of physical assets. “MSCI categorizes those entities correctly without labeling them as investment funds,” the letter states, arguing that DATs should be afforded similar treatment. The firm emphasizes that, unlike passive investment funds, it maintains operational agility to adapt its Bitcoin strategy in line with the asset’s underlying technology, positioning this flexibility as a critical value-creation tool for investors.

The potential financial consequences of the proposed exclusion are significant. Strategy warns that if implemented, the rule could lead to the delisting of numerous companies heavily involved in digital assets from MSCI’s Global Investable Market Indexes. Analysis from JPMorgan, referenced in Strategy’s communication, estimates that Strategy alone could face forced liquidations of up to $2.8 billion as index-tracking funds sell the stock to comply with the new benchmark composition.

Beyond immediate selling pressure, Strategy cautions that the rule would distort fundamental market behavior. The company argues it would create a perverse incentive for Bitcoin miners—a key segment of the industry—to immediately sell their mined assets rather than hold them as strategic treasury reserves, undermining a core part of their business model. This, Strategy suggests, could destabilize market dynamics and contradict the operational reality of these firms.

Strategy frames its opposition not merely as a corporate concern but as a matter of national economic interest. The letter elaborates that excluding DATs could “substantially inhibit innovation” within the digital asset industry, which the current U.S. administration promotes as part of its economic strategy. The firm asserts that digital assets like Bitcoin have the potential to become foundational elements of global finance, but MSCI’s proposal could limit access for major institutional investors.

Specifically, Strategy warns that the move could redirect billions of dollars away from the sector by blocking pension plans and 401(k)s—which often use MSCI indexes as guides—from gaining exposure through publicly traded companies like itself. The firm criticizes the proposal as being rooted in a “flawed understanding” of DATs’ business models and urges MSCI to adopt a more measured approach. It points to MSCI’s past reorganization of the “Communication Services” sector, which involved extensive consultation, as a preferable model for handling evolving industry classifications.

As the debate unfolds, the market reaction appears muted for now. Strategy’s stock, trading under the ticker MSTR, was recently at $185, showing little change amid consolidating cryptocurrency prices. However, the outcome of MSCI’s consultation could have profound implications for the integration of cryptocurrency-focused corporations into mainstream financial benchmarks and the flow of institutional capital into the digital asset ecosystem.