Strategy, the US software company that has become the largest corporate holder of bitcoin with 848,517 BTC, is facing a review that could strip it of a key source of financing: passive demand from MSCI index funds.
On October 15, index provider MSCI approved a new methodology that excludes non-operating companies from its global benchmarks. Under the revised rules, firms that fail an initial operating assets test are then assessed against five additional financial indicators. A company can be removed from MSCI's indices if it fails at least four of those five criteria. Strategy currently sits in both the MSCI USA and MSCI World indices.
MSCI is due to publish the final list of companies affected by the review on November 11, with any changes taking effect after market close on November 30. For European investors, the date matters: passive funds and ETFs tracking MSCI World and MSCI USA hold Strategy shares as a proxy for bitcoin exposure, and removal would force many of them to sell.
A financing model built on share issuance
The stakes go beyond index optics. Strategy has financed the bulk of its bitcoin purchases not from operating cash flow but through sales of its own MSTR stock. On October 12, the company disclosed a purchase of 250 BTC for roughly $21.5 million, of which $21 million came from MSTR stock sales and only $500,000 from its own cash reserves. That pattern has been typical of how Strategy has scaled its treasury to current levels.
Index membership helps sustain that mechanism by generating steady, price-insensitive buying from funds that must hold the stock to track their benchmark. Losing that status would not eliminate Strategy's ability to issue shares, but it would remove a layer of structural demand that has made large, repeated stock sales easier to absorb.
JPMorgan has estimated that outflows tied to a potential exclusion could reach $2.8 billion. Strategy maintains it operates a genuine software business and argues that active treasury management of bitcoin is part of that operating activity, a position that will shape how it responds if MSCI's final list confirms the risk.
Wider implications for bitcoin treasury firms
Metaplanet, the Japanese company that has built its own strategy around bitcoin accumulation and ranks as the second-largest corporate holder of BTC after Strategy, also appears among the companies MSCI's review could affect. For European markets, where bitcoin-proxy equities have drawn retail and institutional interest as an alternative to direct crypto holdings, the review is a reminder that the index inclusion underpinning much of that appeal is not guaranteed. Investors in Europe who have treated MSTR and similar shares as a liquid route into bitcoin exposure will be watching MSCI's November 11 announcement closely.
