Strategy (previously known as Microstrategy), the world’s largest publicly traded corporate holder of bitcoin, is confronting a pivotal moment as index provider MSCI reviews whether to remove the company from its major equity benchmarks.
Chairman Michael Saylor confirmed to Reuters on Wednesday that the firm is actively engaging with MSCI ahead of a decision scheduled for January 15—an outcome that could carry significant implications for Strategy’s market positioning and financial flexibility.
According to a recent JP Morgan note, the Strategy’s potential exclusion could trigger outflows of up to $8.8 billion if other index providers follow MSCI’s lead.
Strategy is currently included in the MSCI USA and MSCI World indices, with a substantial portion of its market valuation linked to passive investment vehicles such as ETFs.
JP Morgan warned that exclusion “would cast doubts on the company’s costs and ability to raise equity and debt in the future.”
While Saylor confirmed ongoing dialogue with MSCI, he expressed uncertainty about the scale of outflows estimated by the bank.
MSCI decision looms amid market volatility
The timing of MSCI’s review comes as Strategy grapples with a steep downturn in its share price, reflecting broader turbulence in the digital asset market.
Bitcoin—whose value effectively underpins Strategy’s business model—has retreated sharply since hitting a record high above $120,000 in October.
The earlier rally was bolstered by US President Donald Trump’s supportive stance on cryptocurrencies and wider regulatory shifts that encouraged institutional adoption.
However, the momentum has since reversed.
Growing caution toward riskier assets, concerns over a potential AI-driven market bubble, elevated tech valuations, and general macroeconomic uncertainty have collectively pressured crypto markets.
Strategy’s shares have fallen more than 37% this year, amplifying investor concerns ahead of MSCI’s decision.
Saylor acknowledged the inherent volatility embedded in Strategy’s structure.
“The equity is going to be volatile because the company is built on amplified bitcoin,” he said. “If bitcoin falls… 30%, 40% then the equity is going to fall more, because the equity is built to fall.”
His remarks underscore the firm’s leveraged exposure to the cryptocurrency’s price swings.
Bitcoin’s decline weighs on Strategy’s treasury model
Strategy operates as a digital asset treasury—a model built around stockpiling cryptocurrency to benefit from price surges while offering more risk-averse investors indirect exposure to bitcoin.
The approach has fueled the company’s rapid ascent and inspired a new cohort of publicly listed firms adopting similar strategies.
Yet the recent deep pullback in bitcoin poses challenges to this model.
As prices fall, firms that rely heavily on holding digital assets could face pressure to sell into a declining market, potentially accelerating negative price momentum.
For Strategy, the downturn comes at a particularly sensitive time, as weaker market conditions could influence how index providers assess its volatility, liquidity, and suitability for benchmark inclusion.
Future uncertain as Strategy navigates index risk
While MSCI has not indicated which way its January decision may lean, the stakes are high.
Benchmark membership not only boosts visibility and liquidity but also provides steady inflows from passive investors.
Losing that status could reshape Strategy’s investor base and constrain its ability to raise capital—an important consideration for a company whose operations are closely tied to bitcoin’s unpredictable trajectory.
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