Strategy’s removal from MSCI indexes could put pressure on its shares but does not require the company to sell Bitcoin, challenging the view that the exclusion drove the cryptocurrency’s sharp selloff.
Speaking on Yahoo Finance’s Daily Wolf on November 13, Scott Melker questioned whether the index decision explained the major Bitcoin selloff. He said selling by funds tracking the indexes should be distinguished from any disposal of Strategy’s Bitcoin holdings.
Melker cited JP Morgan’s estimate of about $2.8 billion in forced outflows following the removal, less than a day’s trading volume in Strategy shares. Index-tracking funds would have to sell their holdings, he said, but the estimated outflows alone did not justify overstating the impact.
He stressed that the exclusion creates no obligation for Strategy to sell Bitcoin. The company remains listed on NASDAQ, he added, distinguishing removal from an index from a stock exchange delisting or a forced sale of its cryptocurrency holdings.
Melker also questioned how the eligibility criteria were being applied. He said MSCI had tightened requirements around operating businesses and income, affecting asset-holding companies including Strategy, Metaplanet, uranium holder Yellow Cake and some European agriculture companies. He contrasted their treatment with Berkshire Hathaway, whose stock holdings and investment activities, he argued, had not attracted the same scrutiny.
Whether other index providers follow remains an open question, Melker said, while noting that there was no evidence they would take similar action. His assessment framed the immediate effect as selling pressure on Strategy shares, with no requirement to sell Bitcoin and no direct implication for Bitcoin itself.
Riza Dagoc
Riza Dagoc reports on regulation, investing and the digital-asset business for TokenPost. Send corrections or tips to [email protected].
