Strategy (formerly MicroStrategy) has given a strong response to the critical MSCI advisory process that could determine the fate of companies holding Bitcoin (BTC) as a strategic asset on their balance sheets.
The company submitted its formal opinion against MSCI’s proposed plan to remove Digital Asset Treasury Companies (DATs) from its Global Investable Market Indexes, arguing that the proposal is “arbitrary, discriminatory and policy-driven.”
It is estimated that there could be an $8 billion asset outflow if Strategy is delisted from the indices.
In a detailed letter to MSCI, Strategy emphasized that DATs are not mutual funds, but rather operate as operational companies. The company stated, “DATs are not passive Bitcoin funds; they actively use Bitcoin to create value for shareholders.” Strategy also noted that it is currently developing innovative Bitcoin-backed digital lending products, similar to those historically offered by banks and insurance companies.
Strategy argued that MSCI's proposed rule of “exclusion from the index if 50% of the balance sheet is comprised of digital assets” is a discriminatory practice specific to this sector. The company pointed out that other companies concentrated in a single asset class, such as oil, gold, real estate, or media, do not receive such treatment.
The letter also stated that the rule in question was practically unenforceable: fluctuations in asset prices, different accounting rules, and international reporting differences would cause DATs to constantly enter and exit the index, leading to instability.
Strategy stated that MSCI's mission is to reflect financial markets impartially, but the proposal targets a specific asset type and incorporates policy elements into the index methodology. This, they argued, would undermine MSCI's role as an impartial index provider and create confusion for investors.
The company argued that the proposal contradicted the US goal of leadership in digital asset technologies and would undermine investment and innovation in the sector. It noted that Bitcoin and digital assets could play a critical role in the future of global financial infrastructure, and that this was the wrong time to exclude such companies.
Strategy Chairman Michael Saylor also stated in his announcement that they opposed MSCI's plan, saying:
“Strategy has submitted its response to MSCI’s consultation regarding digital asset treasury companies. Index standards should be neutral, consistent, and reflect global market evolution.”
Saylor appealed to the community to read the letter and show their support.
The company requested that MSCI withdraw the proposal entirely. Instead, it stated that, just as MSCI did when creating the “Communications Services” sector, years of evaluation, sector maturation, and extensive public consultation processes should be followed.
*This is not investment advice.
