On Monday, MSCI, a prominent global index provider, announced its decision to maintain the existing treatment of cryptocurrency treasury companies within its Global Investable Market Indexes. This announcement specifically waived the proposed exclusion of firms that hold 50% or more of their total assets in digital assets. The decision resulted in a notable after-hours market response, particularly elevating the equity of companies like Strategy Inc. (NASDAQ:MSTR), which is the largest such entity globally in terms of cryptocurrency treasury holdings.
MSCI’s decision followed an extensive consultation period during which concerns were voiced by institutional investors. Many raised the point that cryptocurrency treasury companies exhibit traits akin to investment funds. During this consultation, feedback suggested that these companies might be part of broader conglomerates whose principal operations are investment-oriented rather than driven by operational business activities. MSCI indicated that distinguishing between firms functioning as investment vehicles and others holding digital assets as part of non-investment core operations requires further investigation and market participant engagement.
Strategy Inc. and its founder, Michael Saylor, welcomed MSCI's announcement. Strategy publicly recognized the decision as a “strong outcome for neutral indexing and economic reality,” extending gratitude to their investors and the broader Bitcoin community through a statement on X. The company currently holds approximately 673,783 bitcoins, valued at an estimated $62.5 billion.
Previously, Strategy Inc. had expressed opposition to MSCI’s proposed 50% digital asset holdings threshold, critiquing it as “discriminatory, arbitrary, and unworkable.” The firm argued that fluctuation in cryptocurrency market prices would cause such companies to alternately enter and exit major indexes, creating instability and uncertainty for index providers and passive investors alike. Additionally, Strategy viewed the exclusion rule as contradictory to policies encouraging innovation, as highlighted during the Trump administration.
Financial analysts from JPMorgan projected that removal of Strategy from major benchmarks could potentially trigger passive outflows estimated at $2.8 billion. Michael Saylor dismissed this forecast as alarmist.
The stock market responded notably to MSCI's announcement. Strategy shares rallied approximately 6.60% in after-hours trading, reaching a price of $168.40 according to Benzinga Pro data. This increase followed a regular trading session where the stock closed down 4.10% at $157.97. It is important to note, however, that over the past year, MSTR’s stock price has declined by 58%, and it currently exhibits a weaker price trend across short-, medium-, and long-term periods.
This market movement and MSCI’s decision underscore ongoing debates about the classification of cryptocurrency treasury companies within investment indexes. The clarity on how these firms are categorized will likely evolve as MSCI continues its consultations and research, seeking alignment with the economic realities and characteristics of such companies.
Investors and market participants interested in further comparative data on Bitcoin-treasury companies can consult Benzinga Edge Stock Rankings, which provide analytical insights and ranking metrics.
Disclaimer: The content herein was produced with partial assistance from Benzinga Neuro and reviewed editorially by Benzinga staff. All market data cited is sourced appropriately. The author maintains a neutral viewpoint without investment recommendations.
MSCI’s decision followed an extensive consultation period during which concerns were voiced by institutional investors. Many raised the point that cryptocurrency treasury companies exhibit traits akin to investment funds. During this consultation, feedback suggested that these companies might be part of broader conglomerates whose principal operations are investment-oriented rather than driven by operational business activities. MSCI indicated that distinguishing between firms functioning as investment vehicles and others holding digital assets as part of non-investment core operations requires further investigation and market participant engagement.
Strategy Inc. and its founder, Michael Saylor, welcomed MSCI's announcement. Strategy publicly recognized the decision as a “strong outcome for neutral indexing and economic reality,” extending gratitude to their investors and the broader Bitcoin community through a statement on X. The company currently holds approximately 673,783 bitcoins, valued at an estimated $62.5 billion.
Previously, Strategy Inc. had expressed opposition to MSCI’s proposed 50% digital asset holdings threshold, critiquing it as “discriminatory, arbitrary, and unworkable.” The firm argued that fluctuation in cryptocurrency market prices would cause such companies to alternately enter and exit major indexes, creating instability and uncertainty for index providers and passive investors alike. Additionally, Strategy viewed the exclusion rule as contradictory to policies encouraging innovation, as highlighted during the Trump administration.
Financial analysts from JPMorgan projected that removal of Strategy from major benchmarks could potentially trigger passive outflows estimated at $2.8 billion. Michael Saylor dismissed this forecast as alarmist.
The stock market responded notably to MSCI's announcement. Strategy shares rallied approximately 6.60% in after-hours trading, reaching a price of $168.40 according to Benzinga Pro data. This increase followed a regular trading session where the stock closed down 4.10% at $157.97. It is important to note, however, that over the past year, MSTR’s stock price has declined by 58%, and it currently exhibits a weaker price trend across short-, medium-, and long-term periods.
This market movement and MSCI’s decision underscore ongoing debates about the classification of cryptocurrency treasury companies within investment indexes. The clarity on how these firms are categorized will likely evolve as MSCI continues its consultations and research, seeking alignment with the economic realities and characteristics of such companies.
Investors and market participants interested in further comparative data on Bitcoin-treasury companies can consult Benzinga Edge Stock Rankings, which provide analytical insights and ranking metrics.
Disclaimer: The content herein was produced with partial assistance from Benzinga Neuro and reviewed editorially by Benzinga staff. All market data cited is sourced appropriately. The author maintains a neutral viewpoint without investment recommendations.