MSCI's latest proposal may exclude bitcoin firms Strategy and Metaplanet from stock indexes, introducing new screening criteria.
MSCI has proposed new rules that could lead to the exclusion of bitcoin holding companies, such as Strategy and Metaplanet, from its stock indexes. This move comes as part of a broader consultation aimed at defining what constitutes a "non-operating company" in its Global Investable Market Indexes.
New Screening Criteria for Index Inclusion
The proposed criteria involve a two-step screening process that assesses companies based on their operating assets and five specific financial ratios. Companies that fail four out of these five ratios would be deemed ineligible for index inclusion. If applied to current data, this could have resulted in the exclusion of Strategy, Metaplanet, and uranium holding company Yellow Cake from the MSCI ACWI IMI Index.
Strategy, which has accumulated approximately 840,447 BTC (valued at around $53.18 billion) since 2020, is the largest publicly traded bitcoin holding company. Metaplanet has also made significant investments, acquiring 43,000 BTC valued over $2 billion.
Details of the Proposed Screening Process
The initial assessment determines if a company's operating assets exceed 50% of its total assets. If this condition is met, no further evaluation is needed. Companies that do not meet this threshold will undergo a secondary screening based on five financial ratios: operating asset intensity, expense intensity, cash flow, fair value intensity, and capital dependence.
MSCI defines non-operating companies as those that primarily generate value by holding non-operating assets and do not produce significant cash flow from operations. This proposal builds on a previous effort that targeted firms with substantial digital asset treasuries, which was postponed after causing market volatility.
Feedback and Implementation Timeline
MSCI is currently soliciting feedback from industry stakeholders until September 30. Any resulting changes would be incorporated into the MSCI index review scheduled for November 2026.
