MSCI Index Changes May Force $15B Crypto Treasury Selloff
Crypto journalist
Anas Hasan
Crypto journalist
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MSCI's proposal to exclude digital asset companies from global investable market indexes has sparked strong opposition from industry leaders, with analysts warning the move could put $10 billion to $15 billion of selling pressure on 39 companies with a float-adjusted market capitalization of $113 billion.
The consultation closes on December 31, with a final decision expected by January 15, 2026, targeting firms whose digital assets represent more than 50% of their total assets, with implementation planned for the February index review.
Strategy Inc. In a Dec. 10 letter signed by Executive Chairman Michael Saylor and CEO Fong Le, he publicly opposed the proposal, calling the move “misguided” and with “significantly damaging consequences” for capital markets and America's digital asset leadership.
The company said the proposal is at odds with the current administration's pro-innovation digital asset agenda, including initiatives like the Strategic Bitcoin Reserve and efforts to expand pension plan access to digital assets.
Working companies face the allocation of investment funds
The main argument of the strategy focuses on identifying active businesses from suitable investment vehicles.
He emphasized that the company runs a Bitcoin-backed corporate treasury and capital markets program, issuing equity and fixed income instruments with varying degrees of exposure to Bitcoin.
BitcoinForCorporations Technical Analysis MSCI's proposal violates the main benchmark principles of representativeness, neutrality and stability according to IOSCO and BMR requirements.
The group notes that MSCI has historically included REITs despite its 75% real estate holdings, Berkshire Hathaway, with a large investment portfolio, and mining companies with significant gold holdings.
However, it has never singled out companies based on their treasury assets.
The strategy cautions that MSCI's 50% threshold is arbitrary, and crypto volatility and different accounting standards can result in “on-and-off” indexes as companies' valuations change.
The method of industrial coordination challenges
Strive Asset Management filed a protest on Dec. 6, with CEO Matt Cole arguing that the proposal misunderstands the role of Bitcoin-focused firms in the AI infrastructure.
Miners including MARA Holdings, Riot Platforms and Hut 8 are retooling their data centers for heavy AI workloads. “Many analysts argue that AI competition is increasingly limited by power supply, not semiconductors,” Cole wrote.
Strive offers a parallel version of an “ex-digital asset treasury” index, which allows a selector while maintaining full market exposure to others.
For now, the BitcoinForCorporations petition against the exclusion has gathered more than 1,000 signatures, with Bitwise Asset Management backing the strategy, arguing that “the power of a great index lies in its neutrality.”
The financial impact analysis shows a strong risk
Before now, JPMorgan analysts had estimated that the strategy alone could face $2.8 billion in outflows, with $9 billion of the market capitalization held by real funds.
BitcoinForCorporations analysis projects a total of $10 billion to $15 billion in forced sales, tracking error of 15 to 150 basis points, as volatility, especially institutional obligations with a tracking tolerance of 20 to 50 basis points is harmful.
The priority list includes 18 current entities representing $98 billion in float-adjusted market capitalization, accounting for 87 percent of total capital exposure.
An additional 21 non-members worth $15 billion face permanent exclusion, representing a major pre-emptive block in the MSCI mechanism. Strategy accounted for 74.5% of the total impact of $84.1 billion.
Execution costs range from $50 million to $225 million among index families, and turnover costs range from 5 to 25 basis points. The MSCI ACWI faces the highest estimated impact, ranging from $55 million to $225 million.
Speaking to Cryptonews, VALR co-founder and CEO Farzam Ehsani explained that markets are pricing in forced flow.
“The market is assessing not only the decline in stock prices of companies whose balance sheets are linked to Bitcoin activities, but also possible chain reactions in funds using these indices as benchmarks,” Ehsani said.
Affected companies collectively hold more than $137 billion in digital assets.
The industry awaits MSCI's January 15 decision. The strategy urged MSCI to reject the proposal, saying “the best approach is for MSCI to remain neutral and let the markets determine the course of DATs.”
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