MSCI Rule Puts Strategy at Risk, Says Bitcoin Policy Institute Paper

What happened

The Bitcoin Policy Institute published a research paper titled Wall Street's Invisible Committee on MSCI's proposed test for "non-operating companies." The paper says the rule could remove Strategy and Metaplanet from MSCI's indexes.

MSCI first proposed excluding digital asset treasury companies from its global indexes in 2025 and shelved that plan in January. On Aug. 3 it returned with a wider proposal: MSCI would first check whether a company has substantial operating assets, then apply five more financial tests. Its own simulation showed Strategy, Metaplanet and uranium investment company Yellow Cake would be removed under the method.

After shelving the earlier plan, MSCI kept interim restrictions on affected digital asset treasury companies, including limits on new additions to its indexes. MSCI says the test targets companies whose value comes mostly from accumulated assets rather than revenue-generating operations.

Why it matters

A private index committee that never touches investor cash can still trigger billions of dollars in stock trades. When the list changes, funds that track the benchmark usually have to follow.

Being dropped from MSCI indexes could push tracking funds to sell the shares. JPMorgan analysts estimated in 2025 that Strategy could face about $2.8 billion in outflows if excluded.

The institute also questions MSCI's use of the term "operating assets," which it says is not a standard balance sheet category under US GAAP or international standards. That could leave MSCI wide discretion over classifying cash, investments, construction projects and strategic holdings, and the paper says the issue could reach capital-heavy businesses such as mines or satellite networks.

The institute asked MSCI to publish clearer criteria that others can reproduce.

What the data shows

Index funds held $21.8 trillion as of July. That is 53.9% of U.S. long-term fund assets, against $18.6 trillion in active funds, and by 2025 index funds owned 19% of the U.S. stock market.

MSCI says $21 trillion is benchmarked to its indexes. Equity exchange-traded funds that track them directly account for $2.8 trillion of that.

JPMorgan analysts said MSCI-tracking funds could sell roughly $2.8 billion of Strategy shares, climbing to $8.8 billion if other index providers followed.

Strategy recently spent $143 million on 1,665 Bitcoin, lifting its holdings to 847,666 Bitcoin.

Under MSCI's earlier 2025 proposal, companies whose digital assets made up at least 50% of total assets would have been excluded.

Background

MSCI first proposed excluding digital asset treasury companies from its global indexes in 2025. It set that plan aside in January after pushback and turned to a broader review of non-operating companies.

MSCI kept interim restrictions on affected digital asset treasury companies during the review, including limits on new additions to its indexes.

Companies already in the indexes get buffers and would generally have to fail two consecutive annual reviews before removal.

MSCI took feedback through Sept. 30 and expects to announce results on or before Oct. 16. Any changes would take effect in its November 2026 Index Review.

What is still unclear

• MSCI had not responded to a request for comment before publication.
• It is unclear how MSCI would classify cash, investments, construction projects and strategic holdings, because "operating assets" is not a standardized category.
• The paper asks whether the broader language carried forward MSCI's earlier effort to exclude digital asset treasury companies, pointing to where the consultation's source presentation was stored.

Questions readers ask