MSCI has adopted a rule that could push Strategy, the company holding 848,250 BTC, out of its flagship indexes after Nov. 30, and JPMorgan puts the possible forced selling at $2.8 billion.
Key Takeaways
- MSCI adopted its non-operating company exclusion rule on Oct. 15, with changes effective after Nov. 30.
- JPMorgan estimates Strategy could face about $2.8 billion in passive outflows if removed.
- MSCI will publish the final list of affected companies, including Metaplanet, on Nov. 11.
What Did MSCI Actually Decide?
On Oct. 15, MSCI published the results of its consultation on “non-operating companies.” These are firms that mostly accumulate and hold assets rather than run a business, and they will no longer be eligible for the MSCI Global Investable Market Indexes (GIMI). Trillions of dollars in passive money track those benchmarks.
The screen works as follows:
- A company first faces a core test of whether operating assets make up more than half of its balance sheet.
- If it fails, it moves to five financial ratios covering operating asset intensity, expense intensity, cash flow, fair value intensity and capital dependence, as laid out in the August proposal.
- Failing four of the five makes the company ineligible.
Nowhere does the rule mention bitcoin, and it doesn’t need to.
Is Strategy out?
Not yet, but the fine print of key importance is that the consultation document ran a simulation on May 2026 data that flagged Strategy, Metaplanet and the uranium holder Yellow Cake for deletion from the MSCI ACWI Investable Market Index. The final list of affected constituents lands on Nov. 11, and the new rules apply after the close on Nov. 30.
There is also a buffer, as existing index members generally have to fail the screen in two consecutive annual assessments before they are removed. Ethereum treasury firm Sharplink was put on a watchlist rather than the deletion list.
Lastly, MSCI said it will lift the temporary restrictions it had placed on companies holding digital assets worth at least 50% of total assets, and assess them under the new method instead. The old crypto-specific freeze is gone, and a stricter, crypto-neutral test replaces it.
Who Has to Sell, and How Much?
JPMorgan analysts have estimated that a removal could trigger about $2.8 billion in outflows from Strategy stock, and more if other index providers copy the approach. Index funds don’t argue with methodology; they simply rebalance.
Subsequently, MSTR fell as much as 4.3% after hours, after closing the regular session at $151.29, up from $143.24 a day earlier. Bitcoin barely moved, but its price did slip about 0.5% on the news and was trading near $82,000 early Friday.
For scale, Strategy reported holding 848,250 BTC as of Oct. 11, bought for $64 billion at an average of $75,444 per coin. The company added 250 BTC that week while buying back nearly 2 million STRC shares.
Why Did Metaplanet Rally Anyway?
The most telling reaction came from Tokyo as Metaplanet, the other bitcoin treasury firm named in MSCI’s simulation, traded at $1.76 (¥278) on Friday, up about 4.9% from its $1.86 (¥265) close. Some of the fear had clearly been priced in since August.
Strategy bulls online made the same argument and Michael Saylor has long described the company as an operating business with a software arm alongside its treasury. He further told Bloomberg this week that the bitcoin bottom is in.
Whether MSCI’s ratios agree is now a matter of arithmetic, not an overarching narrative.
The Calendar From Here
- Nov. 11: MSCI publishes the final list of affected constituents.
- Nov. 30: The rules take effect at the close, with deletions applied at the November index review.
- Next annual check: Any company that fails a second consecutive assessment faces removal under the buffer. Interesting month ahead, to say the least!