Strategy Dismisses MSCI DAT Listing Changes as Non-Impactful Yet Opposes New Rules

• Strategy downplayed the impact of its potential delisting from the MSCI index, yet strongly pushed back against a proposal that could exclude DATs from its listing.

Strategy’s (formerly MicroStrategy) inclusion in Morgan Stanley Capital International (MSCI) Global Investable Market Indexes (GIMI) has been a subject of debate in the stock and crypto investing circles. It has been a perennial topic since it officially joined the index in mid-2024.

Several attempts have been made to remove the company from the MSCI GIMI due to concerns about its aggressive Bitcoin (BTC) accumulation since 2020. One of the latest instances was on the way to the global stock market index’s February review, but MSCI eventually retracted the decision.

MSCI Proposed New Eligibility Test

In early August, the MSCI announced a proposal for a new eligibility test under its GIMI methodology. This time, it wants to exclude “non-operating” companies from its assessment.

The MSCI defines non-operating companies based on the following characteristics:

• The company creates value by accumulating and holding non-operating assets
• It spends and generates little cash from running an actual business
• The institution’s performance is solely driven by market movements, not other revenue-generating activities
• The entity relies too much on external capital to grow, not on its own operations

Digital asset treasury (DAT) companies will mainly take a hit under the new rules. It could potentially exclude them from joining the index in the future, while existing ones, such as Strategy and Metaplanet, would be delisted.

MSCI’s consultation period for the new proposal is ongoing, and it will run until September 30. The company will release its decision on the subject by October 16 and rebalance its listing by November 11 if the changes push through. The GIMI will fully enforce the potential changes by December 1.

Strategy’s Stance in the MSCI’s Proposed GIMI Methodology Restructuring

Strategy believes the proposal “would not meaningfully affect” its business. It claimed that funds tracking the MSCI GIMI only lead to 3.1% exposure to MSTR shares. Nonetheless, it vehemently opposed the potential rule change.

The company argued that MSCI’s latest move is merely a rehash of its attempt to delist companies with over 50% digital asset holdings. It hasn’t worked before, so it’s unlikely to succeed this time.

Additionally, Strategy pointed out that MSCI’s “operating” and “non-operating” terminology doesn’t align with any recognized framework, such as US Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS). It explained that its Bitcoin playbook complies with regulatory standards and securities laws as it reports its business under the operating segment of US GAAP, consistent with Securities and Exchange Commission (SEC) requirements.

Moreover, Strategy accused MSCI of changing the rules “to reach a predetermined outcome.” The Bitcoin development company claimed that the proposal defeats the index’s neutrality and injects MSCI’s inherent bias against DATs into its listing.

Strategy urged MSCI to withdraw its proposal and sought support from the Bitcoin and crypto community in the matter.

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