According to Woofun AI, MSCI (MSCI.US), the world's leading index compiling agency, is preparing a major adjustment that could reshape the boundary between crypto assets and traditional finance. Its core focus is on the issue of abolishing the index eligibility of Bitcoin's largest institutional buyer Strategy (MSTR.US).
This potential exclusion is not only about the valuation logic of a single company, but is also likely to trigger the withdrawal of billions of dollars of passive capital, which in turn will have a profound impact on the liquidity structure of the Bitcoin spot market.
Advancing the timeline is pushing the market to a critical point. The final results are expected to be officially announced after 6 a.m. on November 12, Beijing time. At that time, the market will reveal whether Strategy has been confirmed as an exclusion target. By the close of November 10 EST, Strategy's common stock closed at $121.07 and fell 3.60% on the same day, down about 6.4% from the closing price of $129.30 on November 5. Market sentiment already reflected some pessimistic expectations ahead of time. According to the latest data disclosed by the company on November 9, as of November 8, it held a total of 850,364 bitcoins, with a cumulative purchase cost of about US$64.16 billion. If the final list confirms its removal, the Global Passive Tracking Fund will launch a forced position adjustment before the market closes on November 30, triggering a rigid sell-off of 1.57 billion to $2.8 billion. This event will directly suppress Strategy's equity premium and block its core channel for delivering incremental purchases to the crypto spot market.
The deep logic behind this adjustment stems from the evolution of MSCI filtering rules. In October of last year, MSCI proposed an exclusion plan for treasury companies with digital assets accounting for 50% or more of total assets. In January of this year, it was decided not to implement it in the February review and switch to a broader review of non-operating companies. On October 16, MSCI finalized a new index entry rule. The new rules will begin with the November index review. Listed companies that mainly rely on holding assets to obtain value and lack actual business activities may be classified as “non-operating companies” and are no longer eligible for inclusion in the MSCI Global Investable Markets Index.
This means that companies that rely on capital market financing to buy coins, such as Strategy, Metaplanet, and Upexi (UPXI.US), may no longer be regarded by MSCI as ordinary operating enterprises, and their index position is facing fundamental challenges.
The breadth of the affected list reveals the scale of this adjustment. MSCI also published a list of potential impacts involving a total of 22 companies, 14 of which are directly related to cryptocurrencies. Of the 5 companies to be removed, 3 are digital asset treasury companies: Bitcoin treasury company Strategy, Bitcoin treasury company Metaplanet, and SOL treasury company Upexi.
The other two are the British uranium investment company Yellow Cake and the Icelandic investment holding company SKEL, which shows that the rules are not just about crypto assets in terms of form. Additionally, 17 of the 22 listed companies are on the watch list, 11 of which are related to crypto assets, including ETH treasury company SharpLink (SBET.US), CC (Canton) treasury company Canton Strategic Holdings, ZEC treasury company Cypherpunk Technologies (CYPH.US), SUI treasury company SUI Group, and TON treasury company TON Strategy, BTC treasury company Capital B, SOL treasury company Solana Company, SOL treasury company DeFi Development (DFDV.US), WLFI treasury company AI Financial, RAIN treasury company Enlivex, and GD Culture, a company that holds BTC and has announced the allocation of TRUMP; the remaining 6 are non-cryptographic investment holding companies, including those in Canada Urbana, Stack Capital, etc.
According to data compiled by Woofun AI, this list covers a wide range of treasury entities, from mainstream public chains to niche tokens, showing the traditional index system's systemic exclusion of the “backdoor coin hoarding” model.
The core of the dispute is the definition of “operational.” Strategy objected to the new approach. The company believes that it still operates a software business and uses the Bitcoin business as an operating division in financial reports. MSCI's new rules actually target digital asset treasury companies once again.
However, MSCI's screening mechanism is more stringent: the new rules first conduct a core screening to determine whether a company's operating assets exceed 50% of total assets. Companies that fail this threshold are also subject to five financial indicators of operating asset intensity, expense intensity, operating cash flow, fair value strength, and capital dependency. If four or more of these are triggered, they may lose index eligibility. For companies already in the index, MSCI requires that they have not passed the screening in the last two annual reporting periods before they are removed, so only those entering the watch list may be removed until the next round at the earliest; the 5 companies listed as “to be removed” this time will take effect after the market closes on November 30. MSCI said that the new screening method targets companies with similar financial characteristics to investment instruments. The scope of application is not limited to companies that hold cryptographic assets, and is aimed at isolating entities that lack the ability to actually operate hematopoietic.
Selling pressure estimates revealed potential liquidity shocks. Once Strategy was removed, it was its stock MSTR that directly faced selling. Funds that completely copy the relevant index usually need to sell the constituent stocks they hold; funds that use sampling and other methods can be adjusted according to investment strategies, and the trading time and quantity of different products will also vary. According to the deduction model released by J.P. Morgan Chase in August for an earlier version of the digital asset proposal, if all funds, including collaborative benchmarks, are completely withdrawn, the upper limit of funds for passive withdrawal may reach 2.8 billion US dollars. Strategy's official quantitative bottom line is relatively convergent. Estimates show that passive funds tracking the index hold a total of about 13 million shares of MSTR, accounting for 3.1% of their total share capital, and the corresponding current market value is about 1.57 billion US dollars.
Based on a simple calculation of the closing price of $121.07 on November 10, this batch of shares is worth approximately $1.57 billion. The company believes that this amount is lower than the average daily turnover that it counted at the time, and the impact on the business was limited. However, the high volume of sales does not mean that new sales will definitely be picked up by buyers close to the original price. Some investors may anticipate the trading list in advance, and the actual price adjustment will also depend on whether other buyers are willing to accept it. When passive funds sell MSTR, they also don't directly sell Bitcoin on Strategy's balance sheet. The latter is still held by the company, but falling stock prices will be transmitted to financing capacity.
The deeper impact is the risk that the closed loop of financing will break down. The real lethality of passive capital leaving the crypto market is to break the closed loop of arbitrage that Michael Saylor relied on US stock liquidity. Strategy's coin buying model for the past four years has been established, relying entirely on the long-term high premium of its stock transaction price compared to the underlying Bitcoin net asset (mNaV). As long as the premium exists, the company can sell common shares at a high level in the US stock market through the Market Price Addition (ATM) mechanism, and even issue low-interest convertible bonds in exchange for cash in US dollars. These raised fiat currencies were unidirectionally injected by management into the crypto spot market to open positions. The sharp expansion in the size of Bitcoin reserves has further stimulated speculative sentiment among retail investors and hedge funds, driving up stock price premiums, and leading to the next round of larger equity financing. From November 2 to 8, Strategy just sold 2.05 million shares of MSTR to cash out $283.8 million through this mechanism, and then converted $81.9 million into 1,036 Bitcoin spot.
If exclusion brings continued selling pressure, MSTR's stock price and valuation may be affected, and when the company issues shares in the future, the amount of capital it can raise for each share sold will also decrease. To raise the same amount of money, Strategy might need to issue more shares, and the share of existing shareholders declined as a result. If investors also demand higher returns, the cost of a company's financing through preferred shares or debt may also rise. Financing pressure is further transmitted to Bitcoin, requiring companies to reduce future purchases, sales of existing assets, or simultaneous adjustment of positions by other investors. Extraction from the index alone makes it impossible to deduce that Strategy must sell coins, nor can it calculate how much Bitcoin will fall as a result.
However, Strategy has already sold Bitcoin this year. The company revealed that some of the proceeds from the Bitcoin sale this year was used to support preferred stock dividends and STRC repurchases; at the same time, the company continues to buy coins. As of November 8, its dollar reserves dedicated to supporting dividends on preferred shares and interest on debt were approximately $4.77 billion, with an additional $146.2 million in cash available for broader corporate purposes. Even Metaplanet, Upexi, and SharpLink have copied the financial engineering script of issuing stock hoarding tokens. The core weaknesses of these companies are highly consistent, that is, their main business has poor hematopoietic capacity and is extremely dependent on asset premiums in open capital markets to maintain operations. MSCI's qualitative standards establish clear isolation boundaries for traditional financial markets, and the mainstream index system officially cuts off the channel of unconscious blood supply of passive funds to backdoor coin hoarding entities. If index compilers such as S&P and FTSE follow similar rules one after another, the gold window for global listed companies to absorb crypto assets on a large scale by relying on equity leverage in the secondary market will face comprehensive restrictions from the bottom of the traditional financial system.