- MSCI could remove Strategy from major indices in January 2026.
- MSTR’s price declined sharply in recent months.
- MSCI is considering introducing additional listing criteria.
According to JP Morgan, Morgan Stanley Capital International (MSCI) is considering removing Strategy (MSTR) and other digital asset companies from major equity indices, such as the Nasdaq 100, MSCI USA, and MSCI World.
Analysts believe the removal of Strategy, as highlighted, could lead to a significant outflow of funds from the digital assets ecosystem. As a projection, JP Morgan has warned that the event, if realized, would lead to a $2.8 billion withdrawal, which passive fund sell-offs could further amplify.
For context, the decision to exclude or retain Strategy from MSCI is scheduled to come up in January 2026, following the company’s consideration of whether to exclude companies with digital asset holdings exceeding 50% of their total assets from its indices. The condition could affect Strategy, considering that its market capitalization is now close to its Bitcoin reserves, and rising yields on funding instruments highlight the potential systemic risks stemming from declining market confidence.
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MSTR’s Relationship With Bitcoin
Bloomberg’s data reveals a sharp decline in MSTR’s price in recent months, given its leveraged exposure to Bitcoin, which is experiencing significant bearish pressure. In the meantime, MSTR’s latest downward push reflects a sell-off that is likely triggered by concerns about the index’s potential exclusion from MSCI.
It is worth noting that the index inclusion enabled Bitcoin exposure, promoting its encroachment into retail and institutional investor portfolios. Meanwhile, $9 billion out of Strategy’s $59 billion market cap is in passive holdings across ETFs and mutual funds tied to major benchmarks. Therefore, analysts fear that excluding MSTR from major indices could increase the stock’s struggles.
Ongoing Consultations and Potential New Rules
In the meantime, MSCI is engaged in consultations, which will last until December 31, 2025. Part of the discussion involves concerns raised by some market participants who stated that companies like Strategy are more akin to investment funds. Therefore, MSCI is considering introducing additional criteria such as “self-definition” and “financing purpose.”
Related Article: Investor Mike Alfred Ditches MSTR for Strive, Calls Saylor’s Plan a ‘Fairy Tale’
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Source: https://coinedition.com/strategy-mstr-faces-exclusion-from-major-indices-in-january/
