MSCI crypto treasury rules could force up to $15B in sales
MSCI’s ongoing consultation on excluding crypto treasury companies those holding a large share of assets in digital assets from its global equity indexes has intensified debate over market structure and passive flows.
Proponents of inclusion warn that MSCI crypto treasury rules could trigger between $10–$15 billion in passive outflows and related selling if implemented during the February 2026 Index Review.
What MSCI is proposing and why it matters
MSCI is gathering feedback on whether to exclude companies whose digital-asset holdings are ≥50% of total assets and whose primary business is digital-asset treasury activity. Index decisions are consequential because passive funds track MSCI benchmarks; inclusion or exclusion can mechanically drive large buy/sell flows and affect capital access.
Who could be affected and by how much
Scope
A BFC “preliminary list” identifies 39 companies (~$113B float-adjusted market cap) potentially impacted.
Outflows
BFC projects $10–$15B in passive selling; some analysts estimate $11.6B across all impacted firms.
Concentration risk
Strategy (MSTR) accounts for ~74.5% of the impacted float-adjusted market cap. JPMorgan models ~$2.8B in passive outflows if MSTR is excluded from MSCI.
Objections from industry and investors
Critics argue the 50% balance-sheet threshold is a blunt instrument that can misclassify operating businesses as fund-like entities.
BitcoinForCorporations
“A single balance sheet metric cannot reflect whether a company is an operating business,” urging MSCI to withdraw the proposal and use operations-based criteria.
Strive
(Nasdaq-listed): In a Dec. 4 letter, Strive urged MSCI to “let the market decide,” warning that excluding Bitcoin-holding operators could bias indexes against a maturing asset class.
Timeline and next steps
Consultation window: Extended to Dec. 31, 2025.
Final conclusions: Jan. 15, 2026.
If adopted: Implementation targeted for the February 2026 Index Review.
Market impact if the rule proceeds
If MSCI implements the rule, passive indexers may need to divest affected names. The estimated $10–$15B in outflows would likely add selling pressure to crypto-exposed equities and could prompt treasury portfolio rebalancing, potentially spilling over to spot crypto markets already trending lower in recent months.
Alternatives MSCI could consider
Operations-based classification
Emphasize revenue sources, customers, and operating model over a single asset-mix metric.
Look-through thresholds
Use multi-factor tests (e.g., mix of revenue, cash flows, disclosures) with phase-in periods.
Index sub-segments
Create labelled sub-indexes for crypto-treasuries rather than excluding them from flagship benchmarks.
What the MSCI crypto treasury rules mean for Strategy (MSTR)
JPMorgan estimates ~$2.8B of passive outflows tied to MSTR from MSCI-tracked funds alone, with higher totals if other providers mirror the methodology. MSTR’s prominence (about 74.5% of affected float-adjusted cap) magnifies systemic effects; any removal could cascade through ETFs tracking MSCI USA/World and related derivatives.
Investor checklist under the MSCI crypto treasury rules
Review index methodology exposure in mandates.
Stress-test passive flow scenarios and rebalance windows.
Monitor MSCI announcements through Jan. 15, 2026.
Evaluate sector/peer reclassification risks.
Context & Analysis
While MSCI frames the proposal as aligning crypto-heavy companies with fund-like entities (normally ineligible for equity indexes), opponents counter that many generate operating revenue and provide public-market access to digital assets. The decision will shape how passive capital interacts with crypto-exposed corporates, potentially setting a global precedent for index governance and balance-sheet classification.
Conclusion
With a Jan. 15, 2026 decision approaching, stakeholders have only a limited window to influence the final outcome. The proposed MSCI crypto treasury rules are drawing close attention from market participants, as the timing leaves little room for delay or extended debate.
If adopted, these rules could trigger passive outflows running into the tens of billions of dollars, significantly reshaping ETF allocations and investor exposure. The changes would also increase scrutiny on how index providers classify companies with digital-asset-focused treasury strategies, potentially redefining their place within major equity benchmarks.
FAQs
Q: What are the MSCI crypto treasury rules?
A: MSCI is consulting on excluding companies with ≥50% of assets in digital assets and whose primary business is digital-asset treasury activity from its equity indexes.
Q: How much selling could this trigger?
A: Industry estimates suggest $10–$15 billion in passive outflows, with some analyst models estimating around $11.6 billion across affected firms.
Q: Which company is most exposed?
A: Strategy (MSTR) is viewed as the most exposed. JPMorgan estimates about $2.8 billion in passive outflows if it is excluded.
Q: When will MSCI decide?
A: Final conclusions are expected January 15, 2026, with any changes potentially implemented in the February 2026 Index Review.
Q: Is a balance-sheet threshold the only option?
A: No. Critics advocate operations-based classification or dedicated sub-indexes rather than outright exclusion.
Q: Will this affect crypto prices?
A: Yes, indirectly. Forced selling by passive funds could add downward pressure on crypto-exposed equities and potentially spill over into digital-asset markets.
Q: Does this only impact U.S. stocks?
A: No. MSCI’s Global Investable Market Indexes cover both U.S. and international equities.
Facts
Event
Consultation on excluding crypto treasury companies from MSCI equity indexesDate/Time
2025-12-18T12:00:00+05:00Entities
MSCI Inc.; BitcoinForCorporations (coalition); Strategy (MSTR); JPMorgan Chase & Co.; StriveFigures
$10–$15B estimated passive outflows; $11.6B analyst estimate; 39 firms; ~$113B float-adjusted market cap; $2.8B passive outflows modeled for MSTRQuotes
“A single balance sheet metric cannot reflect whether a company is an operating business.” BitcoinForCorporations (petition letter)Sources
MSCI consultation notice + timeline; JPMorgan/MSTR notes; BFC coalition materials; Strive letter (see Sources below)