Strategy (formerly MicroStrategy) faces a crucial test as major index providers consider rules that could remove the company from nearly 9 billion dollars in passive investment flows.
The MSCI is consulting on new criteria that would exclude companies with digital assets exceeding 50% of total assets.
Index exclusion threatens core strategy
Strategy, recently renamed as Strategy Inc., holds 649.870 Bitcoins at the time of this analysis, with an average cost of $74,430 per coin. The company's breakeven price coincides with this purchase point, leaving little margin as Bitcoin faces pressure.
Its market capitalization is $51 billion considering the basic number of shares, and $57 billion fully diluted, while the enterprise value is $66 billion.
MSCI initiated a formal consultation in September 2025 on how to treat digital asset treasury companies (DATs).
According to MSCI's official consultation documents, the proposed rule would exclude companies where digital assets represent 50% or more of total assets and constitute the main business activity.
Some clients argue that these companies resemble investment funds more than operational companies eligible for stock indices.
Risks extend beyond MSCI. Strategy's shares, MSTR, are listed on several important benchmarks, including Nasdaq 100, CRSP US Total Market Index, and various Russell indices.
JPMorgan's analysis suggests that MSCI exclusion alone could result in $2.8 billion in passive fund sales. If other providers make similar changes, total outflows could reach $8.8 billion.
The potential removal of benchmarks like MSCI USA and Nasdaq 100 presents the biggest challenge yet for Michael Saylor's approach to accumulating Bitcoin. A final decision is expected by January 15, 2026.
Valuation premium collapses amid Bitcoin decline
The timing makes these issues more serious. Strategy's shares have fallen 60% from recent peaks, eroding the valuation premium that fueled its fundraising and buying strategy.
Its multiple to net asset value (mNAV) has compressed towards parity, reflecting reduced investor confidence in Saylor's 'sell shares, buy Bitcoin, repeat' model.
Just Bitcoin pic.twitter.com/RTp1Pyqjpt
— Michael Saylor (@saylor) November 20, 2025
This premium is crucial because the Strategy model depends on it. The company issues shares and convertible debt to finance Bitcoin purchases, hoping that shares will trade above the value of its Bitcoin holdings.
If this premium is lost, the business argument weakens, as investors may simply buy Bitcoin directly.
Meanwhile, financing costs have increased. Strategy issued convertible notes in early 2025 on higher terms. With Bitcoin underperforming, the company faces compressed profit margins.
Its Bitcoin holdings show a profit of 15.81% in mid-November, but that margin decreases if prices approach the breakeven point of $74,430.
Market divided on index classification
Not all market participants agree with the proposed exclusion. Matthew Sigel, head of digital asset research at VanEck, highlighted on X that JPMorgan's report reflects client feedback shaping the index rules, rather than an explicit call for exclusion.
$MSTR – JPM says MicroStrategy "at risk of exclusion from major equity indices as the January MSCI decision approaches."
"With MSCI now considering removing MicroStrategy and other digital asset treasury companies from its equity indices…outflows could amount to $2.8bn if… pic.twitter.com/gMqlYtcZII
— matthew sigel, recovering CFA (@matthew_sigel) November 20, 2025
This highlights the issue as being about the process, rather than just the fundamental characteristics of the company.
The consultation exposes uncertainty about how finance should classify Bitcoin treasury companies. MSCI rules typically separate operational companies from investment vehicles.
Strategy operates analytical software but gains more attention for its Bitcoin holdings, creating a hybrid identity that complicates classification.
Other companies also face review. MARA Holdings, Metaplanet Inc., and Bitcoin Standard Treasury Company all hold significant digital assets.
However, the scale and prominence of the Strategy make it a test case. If removed, it will set a precedent for how indices treat public companies using Bitcoin as a reserve.
The decision date of January 15, 2026, is critical. Strategy needs to manage its Bitcoin position, financing costs, and meet shareholder expectations during this period.
The outcome will show whether Bitcoin treasury companies can maintain access to passive capital or risk reclassification and exclusion from major indices. For Saylor's model, the stakes are high.
The Strategy article may lose $9 billion with provider analysis on Bitcoin was first seen on BeInCrypto Brazil.