Strategy faces potential exclusion from MSCI indexes under proposed eligibility rules, putting billions of passive assets at risk. According to Reuters, MSCI is consulting on a criterion that would bar firms whose digital-asset holdings exceed 50% of total assets, a threshold Strategy likely surpasses and that has made the company a focal point for investors and index providers.
MSCI is consulting on a rule that would exclude companies with digital-asset holdings above 50% of total assets. JPMorgan analysts estimate that removal from MSCI alone could trigger roughly $2.8B of forced outflows from index-tracking products; if other major index providers follow, cumulative forced sales could reach $8.8B or even $11.6B. Because index-tracking funds replicate an index’s holdings, they must sell constituents that are dropped, creating mechanically driven liquidity pressure on affected stocks.
Strategy has transformed from a business-intelligence firm into the world’s largest corporate Bitcoin holder. The company has amassed 649,870 BTC — about 3.1% of total Bitcoin supply — with a reported valuation of more than $70B for that position. The accumulation was financed through sizeable capital markets activity, including a $21B equity offering and $8.2B in convertible debt, leaving a leveraged balance sheet that amplifies both upside and downside for equity holders.
Strategy Bitcoin position, funding, and market reaction
Chairman Michael Saylor has framed the pivot as durable. “Index classification does not define MSTR,” he said, while claiming the crypto treasury could cover dividends for 71 years and provide 2.0x debt coverage even if Bitcoin fell to $25,000. The company has reportedly paused its aggressive buying amid the index review.
Market pricing has moved sharply as investors internalize the risk of delisting. Sentiment data cited in the report places the probability of removal between 80% and 95%, a near-consensus view that has coincided with substantial equity losses: Strategy’s stock declined roughly 40–49% over the past month and about 68% from its all‑time high.
Institutional rebalancing and increased short interest have been noted, highlighting two operational risks for crypto treasuries and institutional traders: forced liquidity events from index rules and higher borrowing costs if access to passive investor pools is curtailed.
The MSCI consultation poses an immediate capital‑markets test for Strategy’s approach to holding Bitcoin at scale, with potential forced sales measured in billions and clear implications for liquidity and cost of capital.
