Key Takeaways
- The unraveling of Strategy’s market premium is now putting the company at risk of being cut from major equity indices.
- JPMorgan analysts warned that as much as $2.8 billion could exit if MSCI excludes the stock, with billions more at stake across other index-linked funds.
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Strategy faces the risk of being removed from major equity indices. According to Bloomberg, JPMorgan analysts warned the company could lose its place in benchmarks such as MSCI USA and the Nasdaq 100.
MSCI is reviewing policies affecting companies whose digital asset holdings exceed half of their total assets, a change that could trigger as much as $2.8 billion in outflows if applied to Strategy.
The firm’s Bitcoin-heavy balance sheet, once the driver of a massive valuation premium, now mirrors crypto-market volatility more than traditional equity behavior.
The pressure is also spilling into Strategy’s funding structure, as preferred shares fall sharply and yields rise, signaling investors are questioning the sustainability of a model that once relied on market momentum, cheap capital, and Bitcoin appreciation.
MSCI expects to announce its decision soon after completing market consultations on the proposed digital asset exclusion policies.
