Strategy (MSTR.US) was officially removed from the MSCI index. What does this mean for cryptocurrency holdings?

The Zhitong Finance App learned that the main index provider MSCI completed the first round of review in accordance with the new regulations, and Strategy (MSTR.US) was officially removed from the MSCI index. This is the first actual implementation of MSCI's new framework for so-called “non-operating companies” — as defined by MSCI, the value of such companies mainly comes from holding assets rather than operating a business. In the same batch list, Japan's Metaplanet and Upexi also confirmed their exclusion, while Ethereum treasury company Sharplink was added to the watch list.

After the news was announced, Strategy's stock price fell nearly 4% in US stock night trading. On the Stocktwits platform, retail investors' sentiment about the stock rebounded from “extremely bearish” to “bearish,” and discussions also rose from “low” to “normal.”

How the new regulations work: two-step screening, five tests

MSCI officially adopted this framework in mid-October. The screening is divided into two steps: the first step is to assess whether the company has sufficient operating assets; companies that pass are directly retained, and companies that fail enter the second step — the five financial ratio tests. As soon as four of these are triggered, they will be judged as non-operating companies and lose their eligibility for the index.

The five tests are: operating assets account for less than 20% of total assets; operating expenses account for less than 5% of total assets; operating cash flow is negative; changes in the fair value of non-operating assets exceed 5% of total assets; and dependence on financing exceeds 20%.

For companies like Strategy, this set of tests is almost a tailor-made blocker — Bitcoin is its absolute main asset, the software business is relatively small, and it is easy to trigger multiple indicators at the same time. MSCI also left a buffer clause: only “continuous changes in the business structure” will trigger reclassification, and one-time, temporary failure to meet the standards is not a reason for exclusion. However, the watch list mechanism means that the buffer is limited — companies that have failed to meet the standards during the annual screening period will also be removed if they fail the next annual screening; while crypto treasury companies outside the index cannot be included as long as they have not met the standards once in the last two screenings.

Rule evolution: from the “50% red line” to the “five tests”

This round of exclusion was not a surprise attack; it was the result of MSCI's rules evolving over the past year. In October 2025, MSCI first proposed: excluding companies with digital assets accounting for 50% or more of total assets from the index and imposing temporary restrictions on companies such as Metaplanet during the consultation period — not increasing the number of shares included in the index, not allowing new entrants, and delaying size category adjustments. At the time, J.P. Morgan estimated that the removal of Strategy alone could trigger a passive capital outflow of about 2.8 billion US dollars.

In January of this year, MSCI took a step back: it was announced that it would not remove treasury companies based on the 50% digital asset threshold for the time being, and instead initiated a wider range of consultations — the question expanded from “how to handle cryptographic treasury companies” to “how to classify companies that mainly hold investments rather than operate businesses.” In August, MSCI proposed a financial test plan and simulated it using data from May 2026: Strategy, Metaplanet, and the uranium investment company Yellow Cake were marked as “to be removed,” and Sharplink and others entered the watch list. The new regulations were approved on October 15, came into effect after closing on November 30, and the final list was announced on November 11 — this is the current round of implementation.

What is worth noting is the spillover of the rules: Yellow Cake from the simulated list did not appear on the final exclusion list, but was replaced by Upexi — indicating that the actual implementation of the new regulations is not limited to Bitcoin treasury companies; “holding companies” other than crypto are also within range. In fact, since January of this year, MSCI has deliberately downplayed the “crypto” label, redefining the problem as a neutral “non-operating company” category — gold, commodities, and even any company whose main business is holding assets could theoretically be on the same page. This made the impact of the new regulations go beyond the crypto narrative itself and became a precedent ruling on how to treat “asset-holding listed companies” in index compilation rules.

What does it mean for cryptocurrency holdings

This is a structural turning point for the entire “treasury company” circuit. Strategy's response represents the camp's position: “Digital assets are assets. Index providers should measure the market rather than decide what assets the company can hold.” The company insists that it has a software business, financial operations, and credit instruments secured by Bitcoin, is a normal operating company, and criticized MSCI's methodology for being “arbitrary.”

However, the market-level impact is real: passive funds and ETFs that track the MSCI index need to adjust positions and sell the excluded constituent stocks according to the rules. Although the previous $2.8 billion outflow estimate came from the old 50% threshold plan, its transmission logic still holds true under the new regulations. Smaller treasury companies are under greater pressure — Metaplanet's free-circulation market capitalization in the May simulation was about US$654 million, and the relative share of passive capital withdrawal impacted on its liquidity far higher than Strategy.

The watch list mechanism is still under a second wave of pressure: Sharplink has missed an annual screening, and if it doesn't pass the next time, it will be the next case to be removed. And for crypto treasury companies that are still outside the index, the new regulations essentially shut down entry for the next few months. In terms of capital, “being shut out of the index” means that these companies have lost an important source of passive demand, and the core flywheel of their “issuing shares to buy coins” business model — rising stock prices support increased issuance, and additional issuance supports continued purchases — may have a gap as a result.

Potential impact on Bitcoin

To understand the impact of this incident on Bitcoin, the most important one is: index rules don't force any company to sell Bitcoin; what is being sold is stocks. Bitcoin held by Strategy will not automatically enter the market due to index adjustments.

The real conduction chain is another. Strategy's coin buying model is — when the stock price is higher than its Bitcoin net asset, additional common shares or preferred shares are issued, and the money raised is used to buy coins. The premium is the fuel for this flywheel, and passive buying brought about by the index component status is part of the support for the premium. Once passive funds exit, the demand base for stocks is weakened, and premiums (even currently discounted) are further pressured, the company's financing costs will rise, the scale of additional issuance will shrink, and the amount of future coin purchases will shrink accordingly.

Analysts at ZEROBASE, a decentralized infrastructure network, warned from this perspective: losing index-driven demand could cut off the portion of the increase itself to finance the purchase of coins.

The real risk is not immediate, but at two points:

The first is spillover at the pattern level. Individual investors net sold around 696,000 bitcoins in 2025, while companies, investment funds, and the government combined bought nearly 1 million bitcoins — corporate treasury is one of the most prominent marginal buyers in this market. If the “digital asset treasury” model is shut out of the mainstream index system as a whole, smaller companies such as Metaplanet and Upexi will be hit harder by demand, and incremental purchases for the entire group may shrink, not just Strategy alone.

The second is whether other index traders will follow suit. TFTC has deduced a follow-up scenario between FTSE Russell (FTSE Russell) and S&P Dow Jones Index (S&P Dow Jones), but as of press time, neither company has announced any relevant consultations. This is the biggest tail risk to currency prices in this incident — once the rules spread from one index dealer to the entire index system, what is compressed is no longer a company's ability to finance, but a channel for allocating an entire type of asset.