Market Pulse: Possible MSTR Removal from MSCI Indices

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

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Quick Refresher

MSCI (Morgan Stanley Capital International) is one of the world’s most influential index providers. It creates and maintains equity indices (e.g MSCI World, MSCI ACWI, and MSCI Emerging Markets) that are used as benchmarks by asset managers, ETFs, pension funds, and sovereign wealth funds globally. In simple terms, MSCI decides what counts in many of the portfolios that track “the global stock market.”

Trillions of dollars are passively invested in MSCI-tracked indices. If a stock is included, index funds must own it; if it’s removed, they must sell. MSCI inclusion typically increases trading volume and can support valuation, while exclusion can trigger mechanical selling pressure.

What Happened?

MSCI is running a consultation on how to treat “Digital Asset Treasury” companies, and has proposed excluding companies from its Global Investable Market Indexes if digital assets are 50%+ of total assets, on the view that they may behave more like funds than operating companies.

Timeline (important):

• Consultation open until Dec 31, 2025
• Final conclusions expected by Jan 15, 2026
• Any changes would be implemented in the Feb 2026 Index Review

Why This Matters

• ~$2.8 billion in estimated direct outflows if MSCI alone removes MSTR from its equity indices.
• Up to ~$8.8 billion in potential outflows if other major index providers (such as those behind the Nasdaq-100, Russell, or FTSE indices) follow MSCI’s lead and also exclude the stock.

Potential Impact On The Market

• MSTR sentiment bleeding into BTC-linked equities and proxies.
• Negative impact on BTC if Saylor can’t raise more cash to buy Bitcoin using his stock
• FUD and negative sentiment across the broader crypto market

Cryptonary’s Take

First of all, the exclusion decision isn’t final. The consultation period runs until December 31, 2025, with a final announcement expected around January 15, 2026, and any changes effective in February 2026.

Also worth noting: pushback is getting louder. Companies are now publishing open letters / formal responses to MSCI, arguing the rule is unfair and inconsistent, including Strategy itself and Strive (which sent an engagement letter warning against excluding Bitcoin treasury companies)

According to their letter, Digital Asset Treasuries shouldn’t be treated as ETFs or funds, as MSCI proposed, since they have operating businesses. Additionally, the core principle of passive index funds is neutrality, and “an index provider’s purpose is not to take a view”, according to letters.

Importantly, an MSCI exclusion wouldn’t change MSTR’s Bitcoin holdings, strategy, or long-term thesis, but it would create a negative sentiment around MSTR's ability to raise more fiat to buy Bitcoin using its stock.

This is something we are monitoring that could create a challenge for the market in the near short-term. However, the long-term thesis remains the same. Bitcoin will eat Gold’s market share, and as long as countries around the world continue debasing their currencies (which we think they certainly will), BTC is on track to $250k, then $500k and then $1m (if they address quantum and security budget risks) We should remember that fiat is infinite, and BTC is scarce. The exclusion from an index won’t stop it from reaching new highs.