Strategy Soars After MSCI Confirms Inclusion Of Bitcoin Treasury Firms In Its Index

On Wednesday, shares of Strategy (MSTR) climbed by 6% after Morgan Stanley Capital International (MSCI) introduced that it might preserve the inclusion of digital asset treasury companies (DATCOs) in its indexes. 

Strategy Maintains Index Designation 

Speculation surrounding a possible exclusion of Strategy—the main participant within the Bitcoin treasury area led by CEO Michael Saylor—had fueled uncertainty available in the market. 

This concern contributed to a substantial decline in cryptocurrency costs together with Bitcoin on October 10, as buyers grappled with the implications of shedding a key index designation.

In its announcement issued on January 6, MSCI confirmed that it might not transfer ahead with the proposal to exclude DATCOs from the MSCI Global Investable Market Indexes as a part of its upcoming February 2026 Index Review. 

Consequently, firms assembly the criterion of holding 50% or extra of their belongings in digital currencies will stay categorized as they’re.

However, MSCI did implement a vital change in its pointers, prompting vital implications for treasury-focused firms like Strategy. 

Capital-Raising Challenges Ahead

Analysts at Bull Theory noted that beforehand, when Strategy would problem new shares to lift capital, MSCI would come with these shares of their index, thus creating an computerized demand from index funds—sometimes requiring them to accumulate 10% of the brand new shares. This pressured shopping for may considerably profit MicroStrategy. 

For instance, if the shares have been priced at $300 every and the corporate issued 20 million new shares, index funds can be compelled to buy roughly $600 million price of shares, enhancing Strategy’s skill to lift capital and, subsequently, its Bitcoin holdings.

Under the new MSCI rule, nevertheless, whereas Strategy can nonetheless problem shares, MSCI won’t enhance the share depend in its index. As a end result, index funds will not be obliged to purchase any new shares, eliminating this earlier demand. 

This shift requires Strategy to hunt non-public patrons for its new shares, which can result in decrease capital raised and an lack of ability to buy as a lot Bitcoin as earlier than.

Morgan Stanley’s ETF Plans

Market knowledgeable Crypto Rover emphasized the underlying query: why did MSCI make this variation? Given MSCI’s origins with Morgan Stanley, the connection to the banking establishment is critical. 

Bitcoinist reported on Tuesday that Morgan Stanley filed for a spot Bitcoin and Solana (SOL) exchange-traded fund (ETF), positioning MSTR as a direct competitor within the crypto funding area. 

Rover highlights that many buyers go for Strategy as a method to realize passive publicity to Bitcoin, which has contributed to a gentle rise in MSTR inventory and has established the corporate as the biggest company holder of Bitcoin.

With the brand new MSCI directive, Rover alleges that Strategy could face challenges in accumulating extra Bitcoin. Any makes an attempt to dilute shares may result in vital declines in MSTR stock because of the lack of passive demand. 

The knowledgeable additionally asserts that this case could immediate massive buyers to reallocate their funds from Strategy and related treasury corporations into Bitcoin ETFs, significantly given the chance that Morgan Stanley’s ETF will appeal to vital funding.

At the time of writing, MSTR is buying and selling at $166, having made a slight restoration from the 16-month low of $150 reached final Friday. 

Featured picture from DALL-E, chart from TradingView.com