One annual screening for companies on the watchlist has already failed. If they fail the next one, they may be removed, and crypto treasury firms not included in the indexes cannot be added while failing either of their last two screens.
- MSCI has announced that it will remove Strategy after releasing its November index review on Wednesday.
- Alongside Strategy, Japan’s Metaplanet and Upexi were also flagged to be removed
- Existing index members are usually removed after two annual reporting periods of failure.
Shares of Strategy (MSTR) edged lower during overnight trading on Wednesday after index provider MSCI confirmed the Bitcoin (BTC) treasury firm will be removed from its global equity indexes.
According to the MSCI November index review, the deletion is scheduled to take effect after market close on November 30 and will remove Strategy from the flagship MSCI USA Index. Funds that track those benchmarks will need to sell the stock by that date.
Besides Strategy, MSCI also flagged Japan’s Metaplanet and Upexi (UPXI), the biggest crypto treasury, for removal. On the other hand, Ethereum (ETH) treasury firm SharpLink Inc. (SBET) was placed on a watchlist.
Why Did MSCI Drop Strategy?
It was the first cut under MSCI’s new rules for what it calls ‘non-operating’ companies. According to MSCI, these are companies whose value comes from owning assets rather than operating a business. In mid-October, MSCI adopted the framework. Under the rules, MSCI evaluated whether a company had sufficient operating assets, and a company that failed had to pass five financial ratio tests. If it failed four of them, it would be disqualified.
Existing index members are usually removed after two annual reporting periods of failure, but Strategy went on the deletion list immediately, which meant it had already failed both periods.
In October 2025, MSCI proposed excluding companies whose digital asset holdings made up 50% or more of their total assets. After industry pushback, it had shelved that plan in January.
How Big Is The Hit?
Strategy has not warned of heavy selling but said the impact will be modest. It said MSCI-linked funds held around $13 million shares in its response to the MSCI consultation. It said that it represented about 3.1% of its basic shares outstanding and less than one day’s trading volume. At Wednesday’s close of $122, the roughly 13 million shares would be worth about $1.6 billion.
How Strategy Challenged MSCI
Executive Chairman Michael Saylor and CEO Phong Le fought back even harder in a letter to MSCI at the end of August. Strategy had already flagged the likely outcome in its third-quarter filing. The company said it expected its Class A stock to be dropped in the November review.
MSTR’s price was down over 1% during overnight trading hours. On Stocktwits, retail sentiment around MSTR moved to ‘bearish,’ from ‘extremely bearish,’ zones, while chatter around it shifted to ‘normal’ from ‘low’ over the past day.
What Does MSCI Decision Mean For Other Crypto Stocks?
MSCI’s final list also marks Metaplanet and Upexi for deletion and puts Sharplink on a watchlist. Watchlisted companies have already failed one annual screen. If they fail the next one, they could also be removed, and crypto treasury firms outside the indexes can’t be added while they fail either of their last two screens.
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