MSCI Review Could Place Heavy Strain on Digital Asset Treasury Firms

Digital asset treasury companies may soon face fresh pressure as global index provider MSCI weighs whether to remove them from its benchmarks in early 2025. The group asked investors in October whether firms holding over 50% of their assets in crypto should remain eligible for inclusion.

Early feedback pointed to concerns that these firms behave more like investment vehicles, which are not normally part of equity indexes.

Charlie Sherry, Head of Finance at Australian exchange BTC Markets, told in an interview that the review is likely to end with removal. He said MSCI rarely opens consultations of this sort unless it is already leaning toward a particular outcome. The consultation remains open through Dec. 31, with final decisions scheduled for Jan. 15. Any rule changes will take effect in February.

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What an Exclusion Could Trigger

MSCI is also planning on whether other conditions should factor into eligibility. For example, whether a company publicly identifies itself as a digital asset treasury firm or whether it raised money mainly to purchase crypto. 

If the index provider moves forward with removal, index-tracking funds would be required to sell the affected stocks. Sherry said this alone could put “meaningful pressure” on the firms concerned.

A preliminary MSCI list contains 38 firms under review. Names include Michael Saylor’s Strategy, Sharplink Gaming. Other major mining operators, such as Riot Platforms and Marathon Digital, are also included in the list. 

Sherry explained that when most of a firm’s worth is from its balance sheet instead of its core business, MSCI considers that outside the boundaries of a regular equity benchmark. He added that this is a turn toward stricter standards compared with the past year.

Shift Toward Clearer Corporate Rules

Analysts at JPMorgan estimated that Strategy could lose about $2.8 billion in market value if MSCI follows through. Bloomberg reported that roughly $9 billion of Strategy’s estimated $56 billion valuation currently sits in passive funds tied to indexes.

Sherry said it remains uncertain whether other index operators would follow MSCI’s lead. He noted that firms often watch each other but do not always act in sync. While S&P has taken strong stances in similar cases, each provider uses its own rulebook.

Despite the uncertainty, Sherry argued that clearer rulemaking will benefit the sector in the long run. He said when companies know exactly how their balance-sheet choices will be interpreted, it removes guesswork for managers and investors. Over time, well-defined standards support steady institutional interest, even if near-term fallout is uncomfortable for some firms.

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