- CEO Michael Saylor confirmed the outcome, stating plainly that $MSTR will remain in MSCI indexes.
- MSCI indexes focus primarily on market capitalization, liquidity, and free float, not on whether a company’s business model is conventional or controversial.
- Keeping Bitcoin on the balance sheet doesn’t stop a company from being in an MSCI index, even if its earnings look different from those of other companies.
While there were concerns that Strategy might be removed from MSCI equity indexes, CEO Michael Saylor himself confirmed the outcome, stating plainly: “$MSTR will remain in MSCI indexes.”
This clarification finally stopped the speculation that had contributed to increased price volatility and negative sentiment around the company’s stock.
The panic started because of suggested changes to how MSCI categorizes companies. Some in the market thought these rules could disqualify firms with unusual balance sheets. Since Strategy now mainly holds Bitcoin, critics worried it might no longer meet the index’s requirements for normal business income or standard accounting.
As analyst ZynxBTC pointed out, the situation quickly turned into worst-case “doom loop” predictions, claiming billions would be sold if Strategy left the index. Although not a total disaster, being removed would have meant less regular buying from index funds and weaker long-term support for the stock.
However, closer examination of MSCI’s actual exclusion lists showed that Strategy was not among the companies affected.
Why Strategy Still Qualifies for MSCI
MSCI indexes focus primarily on market capitalization, liquidity, and free float, not on whether a company’s business model is conventional or controversial. Even with its Bitcoin-focused plan, Strategy qualifies because it is:
- A large, frequently traded U.S. stock.
- Held by many big investment firms.
- Eligible under MSCI’s size and liquidity thresholds.
In short, keeping Bitcoin on the balance sheet doesn’t stop a company from being in an MSCI index, even if its earnings look different from those of other companies.
Still, while the MSCI issue is settled, debate around Strategy itself remains intense.
Investor Andy Constan described $MSTR as effectively “a 1.27 times levered ETF trading at its NAV and paying 10% for its leverage.”
Related: Strategy Expands Bitcoin Holdings to 673,783 BTC as USD Reserve Reaches $2.25 Billion
He argued it shouldn’t be valued like a normal company using metrics like P/E ratios. Constan also restated that Strategy probably won’t ever qualify for indexes like the S&P 500, which require steady, officially reported profits.
In a separate discussion, analyst Novacula Occami disagreed with the idea that Strategy’s preferred shares (like $STRC) are a form of digital credit. He pointed out that they are actually equity (ownership shares) and not a loan, don’t give holders any rights to the company’s Bitcoin, and provide less security than standard preferred shares.
Related: Strategy Challenges MSCI Crypto Treasury Plan and Warns of Forced Outflows
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
Source: https://coinedition.com/why-strategy-was-not-removed-from-msci/
