Strategy CEO Phong Le says the company’s newly built $1.44 billion cash reserve is designed to quiet investor anxiety over its ability to withstand a sharp downturn in Bitcoin.
Key Takeaways:
Strategy built a $1.44B cash reserve to ease investor fears about its ability to meet dividend and debt obligations.
The firm raised the funds in just eight and a half days, aiming to show it can still attract capital without selling any Bitcoin.
Strategy says it will only consider selling BTC if its stock falls below NAV.
Speaking on CNBC’s Power Lunch, Le said the move followed weeks of speculation about whether the firm could continue meeting its dividend and debt commitments if market conditions worsened.
“We’re very much a part of the crypto ecosystem and Bitcoin ecosystem,” Le said. “Which is why we decided a couple of weeks ago to start raising capital and putting US dollars on our balance sheet to get rid of this FUD.”
Strategy Builds Cash Buffer to Avoid Selling Bitcoin in Market Slump
The reserve, announced Monday and funded via a stock sale, is intended to secure at least 12 months of dividend payments, with plans to stretch that buffer to 24 months.
The company emphasized that the stock-funded buildup gives Strategy breathing room without having to sell any Bitcoin during a turbulent period for the market.
Concerns over Strategy’s dividend stability had grown louder in recent weeks as Bitcoin retreated from its highs.
Le acknowledged the market chatter but dismissed it as exaggerated. “We weren’t going to have an issue paying dividends, and we weren’t likely going to have to tap into selling our Bitcoin,” he said.
“But there was FUD that was put out there that we wouldn’t be able to meet our dividend obligations, which causes people to pile into a short Bitcoin bet.”
This afternoon, Phong Le, CEO of @Strategy, joined @CNBC@PowerLunch to discuss how $MSTR moves with bitcoin, how our USD reserve addresses recent FUD, the shifting Overton Window, key volatility drivers, and why bitcoin’s long-term outlook remains strong. pic.twitter.com/1t5hsfov0m
The CEO said raising $1.44 billion in just eight and a half days was intended as a direct response, showing the firm can still attract capital even in a downcycle.
“We did it to address the FUD, and to show people we’re still able to raise money when Bitcoin is under pressure.”
Last week, Le said Strategy would only consider selling Bitcoin if the stock dropped below net asset value and the company lost the ability to raise additional funds.
Strategy has also introduced a new “BTC Credit” dashboard, which it says shows the company holds enough assets to service dividends for more than 70 years.
Strategy Adopts Dual-Reserve Model as BTC Buying Slows
As reported, Strategy has shifted from its long-standing “buy Bitcoin at all costs” approach to a dual-reserve treasury model that pairs long-term BTC holdings with a growing dollar buffer.
The move follows a dramatic slowdown in the firm’s accumulation pace, from 134,000 BTC per month at its 2024 peak to just 9,100 BTC in November, signaling preparation for a potentially prolonged bear market.
Despite the slowdown, the company remains one of the world’s largest Bitcoin holders, with roughly 650,000 BTC on its balance sheet.
Strive, a Nasdaq-listed firm and the 14th-largest public holder of Bitcoin, is pushing back against MSCI’s plan to remove companies with significant digital-asset exposure from its global indexes.
Key Takeaways:
Strive says MSCI’s plan to exclude crypto-heavy firms would shut investors out of key growth sectors.
JPMorgan warns Strategy could face up to $2.8B in losses under the proposal.
Strive argues BTC-focused firms are vital to AI infrastructure and structured finance, making the cutoff unfair.
In a letter addressed to MSCI chairman and CEO Henry Fernandez, the company warned that the proposal, which would exclude firms whose crypto holdings exceed 50% of total assets, risks shutting passive investors out of fast-growing corners of the market.
JPMorgan Warns Strategy Could Lose $2.8B Under MSCI Proposal
JPMorgan analysts recently cautioned that Strategy, a prominent Bitcoin treasury company included in the MSCI World Index, could face as much as $2.8 billion in losses if the exclusion moves forward.
Strategy’s chair, Michael Saylor, has confirmed that discussions with MSCI are ongoing as the company attempts to head off the decision.
Strive CEO Matt Cole argued that the proposal misunderstands the role large Bitcoin-focused firms play in emerging industries, particularly artificial intelligence.
He noted that miners such as MARA Holdings, Riot Platforms, and Hut 8, all potential exclusion targets, are rapidly expanding into AI infrastructure by retooling data centers for high-intensity compute workloads.
“Many analysts argue that the AI race is increasingly limited by access to power, not semiconductors,” Cole wrote, adding that miners are uniquely positioned to meet those needs.
Even as AI revenue increases, he said, companies will continue holding sizable Bitcoin reserves, meaning MSCI’s exclusion would permanently wall off a sector positioned at the intersection of digital assets and next-generation computing.
Cole also pointed to the rising demand for Bitcoin-linked financial products. Firms such as Strategy and Metaplanet function similarly to banks offering structured BTC notes, providing equity-based access to Bitcoin performance without requiring investors to hold the asset directly.
Excluding these treasury companies, he argued, would give traditional financial institutions, including JPMorgan, Morgan Stanley, and Goldman Sachs, an uneven playing field, as index-linked capital would become biased against firms whose business models center on Bitcoin exposure.
Strive Says MSCI’s 50% Rule Would Cause Index “Whiplash”
Strive further challenged the practicality of MSCI’s 50% threshold, noting that tying index eligibility to a volatile asset would cause companies to drift in and out of benchmarks, increasing tracking errors for funds that follow them.
Cole highlighted Trump Media & Technology Group as an example. Despite holding one of the largest public Bitcoin treasuries, it narrowly avoided MSCI’s preliminary exclusion list because its BTC exposure currently sits just under the cutoff.
Instead of a blanket rule, Strive proposed a parallel “ex-digital asset treasury” version of MSCI’s indexes.
This would allow asset managers who wish to avoid crypto-heavy companies to do so, while others could maintain exposure to the full investable universe.
MSCI has not yet indicated whether it will revise its proposal, but industry pressure is mounting as treasury-heavy firms await a final decision.
The Bitcoin price volatility is once again drawing attention to MicroStrategy, the company whose strategy has become a major market reference point, with billions in accumulated BTC and a track record of aggressive buying during downturns. As traders search for stability in a shaky market, Strategy’s stance is being watched closely for what it might signal about the next phase of BTC’s trend.
Why MicroStrategy’s Next Move Could Redirect Market Momentum
Bitcoin’s recent volatility has put MicroStrategy (MSTR), the largest corporate holder of BTC, in the limelight. Walter Bloomberg has revealed on X that analysts are watching closely to see if the company could influence the cryptocurrency’s price if it sells some of its holdings.
According to JPMorgan, Strategy can avoid forced sales as long as its enterprise value-to-BTC holdings ratio stays above 1.0, which currently stands at 1.13 BTC. However, analysts continue to debunk these claims, accusing JPMorgan of spreading misinformation about market manipulation and the company.
Walter stated that if the ratio remains above this level, BTC markets may stabilize and ease recent market pressure. Due to the market pressure, the firm has slowed its BTC purchases, adding 9,062 BTC last month compared to 134,480 BTC a year ago, reflecting a more cautious accumulation approach amid a broader crypto downturn. Its stock has dropped roughly 42% over the past three months.
Additionally, challenges include the potential exclusion from MSCI indices, which could trigger $8.8 billion in passive fund outflows if index funds are forced to divest. However, MicroStrategy holds a $1.4 billion reserve for dividends and interest, helping it avoid selling its BTC even if the price falls further. In the meantime, there is no proof that MicroStrategy is in danger of liquidation.
How Institutional Behavior Builds A Higher Floor For Bitcoin
In a market speculation, Bitcoin is currently experiencing one of the most significant capital migrations in its history, fueled by institutional adoption. Analyst Matthew noted that the current BTC market cycle from 2022 to 2025 has already absorbed an unprecedented amount of new capital, surpassing all previous BTC cycles. This growth is a reflection of the market’s maturity and the ecosystem’s innovative approach to liquidity through regulated instruments.
Furthermore, the network has incorporated more than $732 billion in fresh capital in the current cycle, surpassing the $388 billion that was injected during the 2018 to 2022 cycle. At that time, the surge helped push BTC market capitalization to an all-time high record of $1.1 trillion, a metric that indicates a much higher aggregate cost base for new institutional investors.
Meanwhile, the total settlement volume in the decentralized BTC protocol was approximately $6.9 trillion in just 90 days. Despite this, the number of active on-chain entities dropped from 240,000 to 170,000 per day, which is a reflection of liquidity migration of capital flows into spot ETFs.
Market expert Shanaka recently explained how a historical event is unfolding with MicroStrategy and its Bitcoin strategy. This comes as the company faces a negative valuation from Wall Street while MSCI considers whether to remove MSTR from its indices.
MicroStrategy’s Market Cap Drops Below the Value Of Bitcoin Holdings
In an X post, Shanaka noted that MicroStrategy, which is the world’s largest corporate Bitcoin holder, is now worth less than its BTC holdings. The company currently holds 650,000 BTC, valued at around $60 billion, while the MSTR stock has a market cap of $55 billion. The expert noted that Wall Street is valuing the company at a negative based on this.
He further remarked that this is the sustained NAV inversion since MicroStrategy began the Bitcoin model in 2020. Shanaka noted that the company has created a $1.44 billion emergency reserve to pay dividends. This came after the CEO Phong Le admitted that they might have to sell BTC to fund dividend payments if the mNAV drops below 1.
MicroStrategy’s woes could deepen as MSCI will decide by January whether to expel the company from global stock indices. MSCI is considering whether companies that hold Bitcoin should be regarded as funds or trusts rather than as companies. JPMorgan estimates the company could see $8.8 billion in outflows if other index providers make a similar move.
Shanaka described the math as “merciless,” noting that MicroStrategy has $8.2 billion in debt, $7.8 billion in preferred stock, and $16 billion in total obligations against a $45.7 billion shell. Meanwhile, the company currently holds its BTC at an average cost of $74,436, which the expert noted is 15% above breakeven. As such, he remarked that one sustained drop erases every gain since 2020.
Shanaka stated that MicroStrategy’s current situation is not just about one company but about whether corporations can hold sound money without being destroyed by the very system they sought to escape. He added that the largest experiment in corporate Bitcoin adoption is breaking in real time.
Saylor Confirms Talks With MSCI Over Potential Exclusion
According to a Reuters report, Michael Saylor confirmed that MicroStrategy is in talks with MSCI over a potential exclusion from their indices. MSCI is expected to decide by January 15 whether to remove digital-asset treasury companies that buy Bitcoin and other crypto assets, amid concerns that they are classified as investment funds.
Saylor opined that MicroStrategy’s potential exclusion from MSCI indices won’t make any difference. He explained that his company is currently leveraged by a multiple of 1.11 and could survive a 95% Bitcoin crash. Meanwhile, it is worth noting that Phong Le has stated that it is unlikely they will sell any BTC over the next three years following the creation of the USD reserves, which should be sufficient for dividend payments during this period.
The MSTR stock price has stabilized as Bitcoin recovers from last week's low of $83,000 to $93,000 today, boosting the value of MSTR Bitcoin holdings to over $60.45 billion.
Concerns regarding the potential exclusion of Strategy (MSTR) from the MSCI index emerged last week, with estimates from JPMorgan analysts indicating that such a move could result in approximately $2 billion to $8 billion in outflows.
Amid mounting concerns within the crypto community, Michael Saylor confirmed that the company is in discussions with MSCI regarding its potential exclusion from the provider’s indices.
Michael Saylor Weighs In On Exclusion Concerns
MSCI has stated that by January 15, it will decide whether to remove companies whose business models focus on purchasing cryptocurrencies, amid concerns that these firms resemble investment funds, which are currently ineligible for index inclusion.
Reuters reported that Saylor acknowledged the discussions with MSCI but expressed skepticism regarding JPMorgan’s projections of potential outflows. He commented, “It won’t make any difference, in my opinion,” regarding the implications of a possible exclusion.
Saylor noted that the equity associated with Strategy is inherently volatile due to its significant reliance on Bitcoin’s (BTC) price. He cautioned, “If Bitcoin falls 30% or 40%, then the equity is going to fall more, because the equity is built to fall.”
Currently, Strategy operates with a leverage ratio of 1.11, and Saylor indicated that the company could withstand a steep decline of 95% in Bitcoin prices.
Reports from NewsBTC indicated that Saylor Strategy’s position emphasizing that it is not merely a passive Bitcoin holding entity. Instead, he highlighted that the company functions as a software firm with a proactive financial strategy, countering the narrative surrounding MSCI’s concerns.
Strategy Establishes New USD Reserve
The recent fluctuations in Bitcoin prices have reignited fears of a potential bear market, raising questions about whether Strategy would consider selling some of its substantial Bitcoin reserves, currently exceeding 650,000 coins.
This speculation intensified after Strategy CEO Phong Le addressed the possibility of selling some holdings during an interview on the “What Bitcoin Did” podcast.
Le stated that if the company’s stock trades below the value of its Bitcoin holdings and it is unable to raise additional capital for preferred dividends, a sale might become unavoidable.
“If the stock trades below the value of our Bitcoin, then mathematically we would have to sell some Bitcoin. It would be the last resort,” he explained.
To support this vision, the Virginia-based company recently announced the establishment of a $1.44 billion reserve fund allocated for dividend payments on preferred stock and to meet its debt obligations.
The newly created reserve is funded through proceeds from its at-the-market stock offering. The company aims to maintain a balance sufficient to cover at least 12 months of dividends, with ambitions to extend this coverage to 24 months or more in the future.
Saylor remarked, “Establishing a USD Reserve to complement our BTC Reserve marks the next step in our evolution. We believe it will better position us to navigate short-term market volatility while delivering on our vision of being the world’s leading issuer of Digital Credit.”
At the time of writing, Bitcoin was trading just above $93,000, marking a 4.5% increase over the past 24 hours. MSTR, the stock of the investment firm Strategy, traded up 2% in the premarket.
Featured image from Bloomberg, chart from TradingView.com
Despite a 9% recovery on Tuesday, Bitcoin (BTC) has experienced considerable volatility, with its price plummeting to as low as $84,000 just 24 hours ago. This downturn has had a significant impact on Strategy (previously MicroStrategy) the public company that holds the largest BTC reserves, currently boasting over 650,000 coins.
Strategy T-Rex ETFs Plummet Nearly 85%
NewsBTC reported that the company’s CEO, Phong Le, suggested the possibility of selling some of their Bitcoin holdings in light of the current market conditions.
Alongside this, the company’s leveraged exchange-traded funds (ETFs) have also faced substantial losses, intensifying worries about Strategy’s financial health.
Reuters highlighted that Strategy’s leveraged ETFs, which are designed to magnify returns on the firm’s stock, have been among the largest casualties of this year’s cryptocurrency slump.
Two specific ETFs, the T-Rex 2X Long MSTR Daily Target ETF and the Defiance Daily Target 2x Long MSTR ETF, have seen dramatic declines, losing nearly 85% of their value this year.
Additionally, the T-Rex 2X Inverse MSTR Daily Target ETF has dropped by 48% in the same time frame. In this environment, shares of Strategy, MSTR, have fallen more than 40% this year, driven primarily by Bitcoin’s price crash.
Investor attention is now focused on Strategy’s “mNAV” (market net asset value) metric, which compares the company’s enterprise value to its Bitcoin holdings.
Following Le’s comments, where he mentioned the firm might consider selling cryptocurrencies if the mNAV drops below 1, concerns grew about the firm’s long-term outlook. Current estimates place this ratio around 1.1, according to calculations by Reuters.
Analysts Remain Optimistic
Mike O’Rourke, the chief market strategist at JonesTrading, noted that Le’s remarks diminish the company’s message of steadfastness in holding Bitcoin, even amid market volatility.
The company has also revised its full-year outlook, warning of a potential profit ranging from $6.3 billion to a loss of $5.5 billion, a stark adjustment from its earlier forecast of $24 billion in net profit. This prior estimate, made on October 30, anticipated Bitcoin reaching $150,000 by year-end.
Commenting on the shifting strategies within the firm, Vincenzo Vedda, chief investment officer at DWS, remarked, “Great strategy from Strategy, while prices go up. When they go down, well, the strategic options left to the company are limited.”
Since entering the Nasdaq 100 index, Strategy’s shares have dropped more than 70% from their peak in November 2024, more than halving in value over the year.
Despite this dismal performance, analyst sentiments remain relatively optimistic; of the 16 brokerages monitoring Strategy, 10 recommend it as a “buy” while four suggest a “strong buy,” with an overall median price target of $485, reflecting a potential 183% increase over the next year based on LSEG data.
When writing, the market’s leading cryptocurrency, Bitcoin, managed to recover the $92,000 line.
Featured image from DALL-E, chart from TradingView.com
In a turbulent market marked by falling prices, Bitcoin (BTC) has once again dipped below the $85,000 threshold, driven by growing speculation that Strategy, formerly known as MicroStrategy, may be on the verge of selling some of its Bitcoin holdings.
This intensified after a recent interview on the What Bitcoin Did podcast, during which Strategy CEO Phong Le was directly asked whether the company would consider parting with any of its BTC holdings.
While the firm’s former CEO, Michael Saylor, has consistently maintained a resolute stance against selling, Le’s comments have raised concerns about potential sales in the future.
Is A Bitcoin Sell-Off Imminent?
Le indicated that if Strategy’s stock trades below the actual value of its Bitcoin holdings and the company is unable to raise additional capital for preferred dividends, selling some Bitcoin could become a necessity.
“If the stock trades below the value of our Bitcoin… then mathematically we would have to sell some Bitcoin. It would be the last resort,” he explained.
While this does not confirm an imminent sale, it visibly places the option on the table, leading to increased speculation about a forced sale as preferred dividend payments approach due on December 31.
Adding to the unease, Strategy disclosed in a recent filing with the US Securities and Exchange Commission (SEC) that it has established a USD Reserve of $1.44 billion to cover these upcoming preferred dividends and mitigate the interest on its substantial debt.
This reserve was funded through the proceeds from sales of its class A common stock under the company’s at-the-market offering program. Such moves have diluted current shareholders and contributed to a nearly 11% drop in Strategy’s stock price.
Strategy Downgrades BTC Price Forecast
This shift contrasts sharply with the company’s previous forecasts, which predicted that Bitcoin would soar to $150,000 by the end of the year. Strategy has now revised its expectations, projecting prices to range between $85,000 and $110,000.
The forecast for BTC yields has also been revised down to 24% from a previous estimate of 30%, along with projected Bitcoin gains decreasing significantly from $20 billion to $10.6 billion at the midpoint.
As Bitcoin’s value continues to plummet, it further unravels Strategy’s financial outlook. Nevertheless, social media experts have pointed to a paradox within the company’s messaging.
AlejandroXBT noted that while Saylor has consistently stated he will never sell Bitcoin, he has been conducting private presentations to clients outlining various strategic approaches, suggesting a potential disconnect between public declarations and private planning.
When writing, the market’s leading cryptocurrency trades at $84,880, recording major losses of over 7% in the 24-hour time frame.
Featured image from DALL-E, chart from TradingView.com
Strategy ($MSTR) announced Monday that it has created a $1.44 billion U.S. dollar reserve to safeguard future dividend and interest payments, a move aimed at calming investor concerns that the world’s largest corporate Bitcoin holder might eventually need to sell a portion of its roughly $56 billion BTC stack if market weakness persists.
The Tysons Corner, Virginia-based firm said the reserve, funded by recent Class A common stock sales, will initially cover at least 21 months of dividend obligations.
Over time, Strategy intends to expand the buffer to cover as much as 24 months of payments, strengthening its liquidity position as Bitcoin endures its steepest monthly decline since mid-2021.
Founder and Executive Chairman Michael Saylor said the cash reserve represents the next phase of the company’s evolution, complementing its Bitcoin holdings and reinforcing its strategy of becoming the world’s leading issuer of “Digital Credit.”
CEO Phong Le, whose comments last week sparked fears of a potential BTC sale, said the newly formed reserve sharply reduces the likelihood the company would need to liquidate any of its 650,000 BTC holdings.
Strategy’s market value to Bitcoin (mNAV) ratio — a key metric comparing enterprise value to Bitcoin holdings — had slipped to roughly 1.2 on Monday, inching closer to a level that historically raises concern among investors.
On Friday, Le told a podcast audience that Strategy could sell Bitcoin only if mNAV dropped below 1.0, and only as a last resort.
Investors reacted sharply early Monday to a bitcoin price sell-off, sending Strategy shares down more than 6% pre-market while Bitcoin fell roughly 6%. The stock pared losses after the reserve announcement.
At the time of writing, shares of MSTR are trading at 165.84, down 6.40%.
Strategy’s Bitcoin accumulation
Formerly known as MicroStrategy, the company has evolved from a business-intelligence software firm into a full-scale digital-asset-treasury vehicle, financing its Bitcoin accumulation through repeated equity raises and low-cost perpetual preferred offerings.
Its software division does not generate sufficient free cash flow to cover dividend or interest payments, while Bitcoin itself yields no income.
After a pause in purchases, Strategy added 130 BTC for $11.7 million last week, funded through new common share issuance.
Strategy’s updated forecast
Alongside the reserve announcement, Strategy updated its 2025 guidance, acknowledging that its October forecast — based on a $150,000 year-end Bitcoin price — is no longer realistic.
With Bitcoin recently trading between $80,660 and $111,612, Strategy now assumes a year-end price range of $85,000 to $110,000.
Under that scenario, the company expects operating income ranging from a $7 billion loss to a $9.5 billion profit—a wide spread driven by new accounting standards requiring fair-value BTC mark-to-market treatment each quarter.
Net income is projected between a $5.5 billion loss and a $6.3 billion profit, while diluted EPS could fall anywhere from –$17 to +$19 per share.
Despite market turbulence, Wall Street brokers such as Benchmark say the firm remains structurally sound, with Bitcoin unlikely to fall anywhere near the roughly $12,700 distress threshold analysts estimate would pose genuine solvency risk.
At the time of writing, Bitcoin price fell sharply to the mid-$84,000s early Monday, sliding 8% over the past 24 hours as a wave of macro anxiety, thin liquidity and fresh crypto-native stress hit markets simultaneously.
The world’s largest digital asset traded between a 24-hour high of $91,866 and a low of $84,722, extending a two-month drawdown that has now erased more than 30% from October’s record highs, according to Bitcoin Magazine Pro data.
The downturn marks a swift reversal from last week’s tentative recovery. After plunging below $81,000 on Nov. 21, the Bitcoin price steadily climbed into the end of November and briefly pushed above $92,500 during Black Friday’s morning session.
At the time of writing, the bitcoin price is $86,469.
The MSTR stock price rose by over 2% on Friday as Bitcoin held steady above $92,000 and as analysts, including Tom Lee delivered their bullish forecasts.
MSCI is considering a new rule that would remove companies from its Global Investable Market Indexes if 50% or more of their assets are held in digital assets such as Bitcoin. The proposal appears simple, but the implications are far-reaching. It would affect companies like Michael Saylor’s Strategy (formerly MicroStrategy), Eric and Donald Trump Jr’s American Bitcoin Corp (ABTC), and dozens of others across global markets whose business models are fully legitimate, fully regulated, and fully aligned with long-standing corporate treasury practices.
The purpose of this document is to explain what MSCI is proposing, why the concerns raised around Bitcoin treasury companies are overstated, and why excluding these firms would undermine benchmark neutrality, reduce representativeness, and introduce more instability—not less—into the indexing system.
1. What MSCI Is Proposing
MSCI launched a consultation to determine whether companies whose primary activity involves Bitcoin or other digital-asset treasury management should be excluded from its flagship equity indices if their digital-asset holdings exceed 50% of total assets. The proposed implementation date is February 2026.
The proposal would sweep in a broad set of companies:
Strategy (formerly MicroStrategy), a major software and business-intelligence firm that holds Bitcoin as a treasury reserve.
American Bitcoin Corp (ABTC), a new public company created by Eric and Donald Trump with a Bitcoin-focused balance sheet.
Miners, infrastructure firms, and diversified operating companies that use Bitcoin as a long-term inflation hedge or capital reserve.
These companies are all publicly traded operating entities with audited financials, real products, real customers, and established governance. None are “Bitcoin ETFs.” Their only distinction is a treasury strategy that includes a liquid, globally traded asset.
2. The JPMorgan Warning — And the Reality Behind It
JPMorgan analysts recently warned that Strategy could face up to $2.8B in passive outflows if MSCI removes it from its indices, and up to $8.8B if other index providers follow.
Their analysis correctly identifies the mechanical nature of passive flows. But it misses the real context.
Strategy has traded more than $1 trillion in volume this year. The “catastrophic” $2.8B scenario represents:
Less than one average trading day
~12% of a typical week
~3% of a typical month
0.26% of year-to-date trading flow
In liquidity terms, this is immaterial. The narrative of a liquidity crisis does not match market structure reality. The larger issue is not the outflow itself—it is the precedent that index exclusion would set.
If benchmark providers begin removing companies because of the composition of their treasury assets, the definition of what qualifies as an “eligible company” becomes non-neutral.
MSCI $MSTR DE-LISTING FEAR MONGERING: THE $2.8 BILLION LIE
First: Strategy is at ZERO risk of being delisted from other indices. Second: J.P. Morgan says an MSCI delisting would trigger a $2.8 Billion forced sell off. They are banking on you not knowing the math.
MSCI’s policy position also conflicts with the composition of MSCI’s own assets.
MSCI reports roughly $5.3B in total assets. More than 70%—about $3.7B—is goodwill and intangible assets. These are non-liquid, non-marketable accounting entries that cannot be sold or marked to market. They are not verifiable in the same way that digital assets are.
Bitcoin, by contrast:
Trades globally 24/7
Has transparent price discovery
Is fully auditable and mark-to-market
Is more liquid than nearly any corporate treasury asset outside sovereign cash
The proposal would penalize companies for holding an asset that is far more liquid, transparent, and objectively priced than the intangibles that dominate MSCI’s own balance sheet.
MSCI is a New York based, pubco ( $MSCI) with ~$5.3B in assets on its balance sheet.
70% ($3.7B) of MSCI's assets are classified as “intangible” (goodwill and other intangible assets).
At the same time, MSCI is proposing to exclude companies whose digital asset holdings… pic.twitter.com/dyVwRR2AhH
MSCI is a global standard-setter. Its benchmarks are used by trillions of dollars in capital allocation. These indices are governed by widely accepted principles—neutrality, representativeness, and stability. The proposed digital-asset threshold contradicts all three.
Neutrality
Benchmarks must avoid arbitrary discrimination among lawful business strategies. Companies are not removed for holding:
Large cash positions
Gold reserves
Foreign exchange reserves
Commodities
Real estate
Receivables that exceed 50% of assets
Digital assets are the only treasury asset singled out for exclusion. Bitcoin is legal, regulated, and widely held by institutions worldwide.
Representativeness
Indices are meant to reflect investable markets—not curate them.
Bitcoin treasury strategies are increasingly used by corporations of all sizes as a long-term capital-preservation tool. Removing these companies reduces the accuracy and completeness of MSCI’s indices, giving investors a distorted view of the corporate landscape.
Stability
The 50% threshold creates a binary cliff effect. Bitcoin routinely moves 10–20% in normal trading. A company could fall in and out of index eligibility multiple times a year simply due to price action, forcing:
Unnecessary turnover
Additional tracking error
Higher fund implementation costs
Index providers typically avoid rules that amplify volatility. This rule would introduce it.
5. The Market Impact of Exclusion
Forced Selling
If MSCI proceeds, passive index funds would need to sell holdings in affected companies. Yet the real-world impact is marginal because:
Strategy and ABTC are highly liquid
Flows represent a tiny fraction of normal trading volume
Active managers are free to continue holding or increasing exposure
Access to Capital
Analysts warn that exclusion could “signal” risk. But markets adapt quickly. As long as a company is:
Liquid
Transparent
Able to raise capital
Able to communicate its treasury policy It remains investable. Index exclusion is an inconvenience—not a structural impairment.
Precedent Risk
If MSCI embeds asset-based exclusion rules, it sets a template for removing companies based on their savings decisions rather than their business fundamentals.
That is a path toward politicizing global benchmarks.
6. The Global Competitiveness Problem
Bitcoin treasury strategies are expanding internationally:
Japan (Metaplanet)
Germany (Aifinyo)
Europe (Capital B)
Latin America (multiple mining and infrastructure firms)
North America (Strategy, ABTC, miners, and energy-Bitcoin hybrids)
If MSCI excludes these companies disproportionately, U.S. and Western companies are placed at a competitive disadvantage relative to jurisdictions that embrace digital capital.
Indexes are meant to reflect markets—not pick national winners and losers.
7. MSCI Already Knows That Exclusion Creates Distortion
MSCI’s recent handling of Metaplanet’s public offering shows it understands the risks of “reverse turnover.” To avoid index churn, MSCI chose not to implement the event at the time of offering.
This acknowledgement underscores a broader truth: rigid rules can destabilize indices. A digital-asset threshold creates similar fragility on a much larger scale.
8. Better Alternatives Exist
MSCI can achieve transparency and analytical clarity without excluding lawful operating companies.
A. Enhanced Disclosure
Require standardized reporting of digital-asset holdings in public filings. This gives investors clarity without altering index composition.
B. Classification or Sub-Sector Label
Add a category such as “Digital Asset Treasury–Integrated” to help investors differentiate business models.
C. Liquidity or Governance Screens
If concerns are about liquidity, governance, or volatility, MSCI should use the criteria it already applies uniformly across sectors.
None require exclusion.
9. Why the Proposal Should Be Withdrawn
The proposal does not solve a real problem. It creates several:
Reduces representativeness of global indices
Violates neutrality by discriminating against a specific treasury asset
Creates unnecessary turnover for passive funds
Damages global competitiveness
Sets a precedent for non-neutral index construction
Bitcoin is money. Companies should not be penalized for saving money—or for choosing a long-term treasury asset that is more liquid, more transparent, and more objectively priced than most corporate intangibles.
Indexes must reflect markets as they are—not as gatekeepers prefer them to be.
MSCI should withdraw the proposal and maintain the neutrality that has made its benchmarks trusted across global capital markets.
Disclaimer: This content was prepared on behalf of Bitcoin For Corporations for informational purposes only. It reflects the author’s own analysis and opinion and should not be relied upon as investment advice. Nothing in this article constitutes an offer, invitation, or solicitation to purchase, sell, or subscribe for any security or financial product.
Strategy — the original “bitcoin-on-NASDAQ” proxy — is now facing its most consequential structural risk since Michael Saylor began converting the firm into a leveraged BTC holding vehicle five years ago.
A new JPMorgan research note warns that Strategy is “at risk of exclusion from major equity indices” as MSCI approaches a key January 15 decision on whether companies with large digital-asset treasuries belong in traditional stock benchmarks.
MSCI is weighing a rule that would remove companies whose digital-asset holdings exceed 50% of total assets — a category in which Strategy sits at the extreme.
With the company’s market cap hovering around $59 billion and nearly $9 billion held in passive index-tracking vehicles, analysts say any exclusion could unleash severe mechanical selling pressure.
Outflows could amount to $2.8 billion if MSCI removes Strategy — and as much as $8.8 billion if other index providers follow, the analysts noted.
The current state of MSTR
The warning lands at a vulnerable moment. Strategy shares have fallen more than bitcoin itself in recent months as the company’s once-lofty premium — the “mNAV” spread between enterprise value and bitcoin holdings — has collapsed to just above 1.1, the lowest since the pandemic.
MSTR has lost roughly 40% in value over the last six months, with 11% coming in the last five trading days.
The model that powered Strategy’s rise — raise equity, buy bitcoin, benefit from reflexivity, repeat — now faces structural headwinds: The stock is down over 60% since last November’s high.
Its perpetual preferred shares have sold off sharply, with yields on its 10.5% notes rising to 11.5%. A recent euro-denominated preferred issuance broke below its discounted offer price within two weeks.
Strategy’s inclusion in the Nasdaq 100, MSCI USA, MSCI World, and other benchmarks has quietly funneled the bitcoin trade into mainstream portfolios for years. Passive ETF and mutual-fund flows helped sustain Strategy’s liquidity, valuation, and visibility with institutional allocators.
But MSCI’s October consultation revealed something new according to JPMorgan: Market participants increasingly view digital-asset treasury companies as closer to investment funds than operating businesses. Investment funds are not eligible for index inclusion — and that’s the heart of Strategy’s problem.
MSCI said it does not “speculate on future index changes,” but is evaluating whether digital-asset-heavy balance sheets should remain inside equity benchmarks.
Active managers aren’t required to mimic index changes, but JPMorgan warns that removal alone could spark reputational damage, widen funding spreads, and thin trading activity — making the stock less attractive to large institutions.
Strategy’s rise — and its current risk — underscores how deeply bitcoin has seeped into global finance through indirect channels.
At one point, analysts speculated the company might gain entry into the S&P 500. Instead, the digital-asset treasury model now looks increasingly fragile because Bitcoin is down 30% from its October high and crypto markets have shed over $1 trillion in value.
Strategy’s January 15 inflection point
JPMorgan believes Strategy’s dramatic underperformance relative to BTC is now primarily driven by index-exclusion fears, not bitcoin weakness. If MSCI rules negatively, the company’s valuation could become almost fully tethered to its underlying BTC — with its mNAV ratio drifting closer to 1.0.
That would eliminate the reflexive premium that powered the last half-decade of Saylor’s strategy.
Earlier this year in an interview with Bitcoin Magazine earlier this year, Saylor outlined an ambitious vision to build a trillion-dollar Bitcoin balance sheet, using it as a foundation to reshape global finance.
He envisions accumulating $1 trillion in Bitcoin and growing it 20–30% annually, leveraging long-term appreciation to create a massive store of digital collateral.
From this base, Saylor plans to issue Bitcoin-backed credit at yields significantly higher than traditional fiat systems, potentially 2–4% above corporate or sovereign debt, offering safer, over-collateralized alternatives.
He anticipates this could revitalize credit markets, equity indexes, and corporate balance sheets while creating new financial products, including higher-yield savings accounts, money market funds, and insurance services denominated in Bitcoin.
At Money 20/20 in Las Vegas, Michael Saylor gave a familiar, bullish sentiment for Bitcoin, predicting it could hit $150,000 by the end of 2025 and potentially reach $1 million within the next four to eight years.
Speaking to CNBC, Saylor outlined both the industry-wide shifts in digital assets and the evolving investment products his company is offering, framing them as key drivers for institutional adoption.
Saylor highlighted a milestone for Strategy: the company recently received its first credit rating from S&P — B-minus — making it the first Bitcoin-focused treasury company to be rated.
“It’s a very auspicious start because it represents institutional adoption of Bitcoin-backed credit,” he said, noting that this rating opens the door to hundreds of billions, if not trillions, of dollars in capital that previously would not invest in unrated instruments.
Strategy for different investor profiles
Strategy has a 70% chance of joining the S&P 500 before year-end, according to 10X Research. Its upcoming Q3 2025 earnings, expected Thursday, could show a $3.8 billion gain from fair-value Bitcoin accounting.
Strike, Strife, Stride, and Stretch offer combinations of principal protection, dividends, and yields from roughly 8% to 12.5%, each tailored to different investor profiles — from those seeking amplified Bitcoin exposure to conservative investors needing low-volatility returns.
Uniquely, these instruments generate tax-free dividends structured as a return of capital, giving investors an effective yield comparable to 16–20% on a tax-equivalent basis. “A treasury company built on Bitcoin is the most tax-efficient fixed income generator in the world,” Saylor said.
Saylor also underscored the growing acceptance of Bitcoin within traditional finance. Major U.S. banks, including JP Morgan, Bank of America, and BNY Mellon, are now beginning to offer loans collateralized by Bitcoin, while some are moving toward custodying Bitcoin outright.
“The train has left the station,” Saylor said. “Everybody’s moving forward.”
He argued that the evolving infrastructure, supported by pro-crypto policies from the White House, Treasury, SEC, and CFTC, has created “probably the best 12 months in the history of the industry.”
Saylor sees Bitcoin at $150,000 by EOY
Looking at the broader digital economy, Saylor emphasized the dual role of Bitcoin and digital assets. Bitcoin serves as a long-term store of value — digital capital — while stablecoins and other tokenized currencies act as medium-of-exchange instruments in an increasingly AI-driven financial landscape.
Regarding market trends, Saylor acknowledged the volatility in Bitcoin has moderated as the industry matures, offering more derivatives and hedging instruments.
Analysts covering Strategy and the Bitcoin sector, he said, largely expect the cryptocurrency to reach $150,000 by year-end, with longer-term potential for $1 million per coin.
Over the next two decades, Saylor forecasts Bitcoin could appreciate by roughly 30% annually.
For the first time in financial history, a major credit rating agency has formally evaluated a company built on a bitcoin-backed credit model. In news covered by Bitcoin Magazine, the S&P Global Ratings has assigned Strategy Inc (MSTR) a ‘B-’ Issuer Credit Rating with a Stable outlook, recognizing not just the company, but the emergence of Bitcoin as collateral inside the credit system. This marks a watershed moment for corporate finance.Bitcoin-backed credit is no longer theoretical. It is now a rated financial reality.
Why This Moment Matters
Until now, Bitcoin had been accepted by equity markets, ETFs, and corporate treasury conversations — but credit markets remained untouched. Credit markets are where legitimacy is ultimately decided because they determine who can borrow, at what cost, and against which assets.
By rating Strategy Inc, S&P has implicitly acknowledged:
Bitcoin can underpin structured debt and preferred equity.
A bitcoin-backed credit strategy can be modeled, rated, and priced using traditional frameworks.
Bitcoin is shifting from speculative asset to recognized collateral within corporate capital structures.
This is not a marketing milestone — it is a structural one. Bitcoin has entered the language of risk-adjusted return, yield, and covenants.
How S&P Interpreted Strategy’s Bitcoin-Backed Capital Model
The rating is speculative grade, but the Stable outlook is critical. It signals S&P’s belief that Strategy can continue to service obligations and access capital markets without selling its Bitcoin reserves — a foundational principle of bitcoin-backed credit.
S&P’s analysis mentions several possible weaknesses:
High concentration of assets in Bitcoin
Low U.S. dollar liquidity and negative risk-adjusted capital under S&P’s methodology
Currency mismatch: long Bitcoin, short U.S. dollar debt obligations
However, they also credited Strategy with unique structural strengths:
No near-term debt maturities before 2027–2028
Proven access to capital markets — both equity and debt
A capital stack purpose-built to accumulate Bitcoin without diluting shareholders
Active liability management via convertible debt and preferred stock instruments
In short, S&P is signaling that bitcoin-backed credit can function — if managed with discipline.
Implications for the S&P 500 and Institutional Legitimacy
Strategy Inc met the S&P 500 inclusion criteria in profitability and market capitalization but was passed over in 2024, widely believed to be due to its Bitcoin-heavy balance sheet. That decision now appears less defensible.
With a formal credit rating, the company shifts from “unrated anomaly” to “rated issuer.” For institutional capital, that distinction matters.
Index committees can now reference a risk rating — not just a narrative.
Treasury teams and insurers can benchmark exposure to bitcoin-backed credit against traditional corporate debt.
This increases (not guarantees) the probability of future index inclusion and passive capital flows.
Bitcoin entering equity indices begins with Bitcoin entering the credit models behind them.
Bitcoin-Backed Credit: The Ideal State of Treasury Strategy
This rating does more than validate Strategy — it validates the architecture of bitcoin-backed credit as the superior evolution of corporate treasury management.
Phase 1 was equity-funded Bitcoin accumulation — high growth but shareholder dilution. Phase 2 introduced convertible debt and preferred equity — allowing companies to acquire Bitcoin through capital markets rather than operating earnings. Phase 3, now underway, is full institutional recognition of bitcoin-backed credit — rated, benchmarked, and capable of scaling.
This is the endgame:
Use capital markets to borrow in fiat
Use proceeds to acquire Bitcoin
Service liabilities without selling reserves
Increase Bitcoin-per-share over time, without issuing new common stock
With S&P formally rating Strategy’s issuer credit, this model moves from innovation to infrastructure.
Why Corporate Finance Leaders Need to Pay Attention
This rating does not compel companies to adopt Bitcoin. But it removes the claim that Bitcoin cannot be integrated into traditional credit systems.
From now on:
Bitcoin can be factored into risk-weighted capital models and treasury policy.
Credit and liquidity committees must understand how bitcoin-backed credit affects financing costs, refinancing risk, and balance sheet leverage.
Investors can now compare Bitcoin-based capital structures against other high-yield or hybrid debt strategies.
Boards can no longer dismiss Bitcoin as “unratable” or “unclassified.”
A New Chapter for Corporate Finance and Capital Markets
What makes this moment different isn’t that another institution “acknowledged” Bitcoin. That’s happened before with ETFs, GAAP accounting changes, and treasury allocations.
What’s different is where the recognition has now occurred: Not in equity markets. Not in payment networks. But in credit — the foundation of corporate finance and monetary systems.
When a credit rating agency like S&P evaluates a company built on Bitcoin, it does three things that have never happened before:
It forces Bitcoin into risk models normally reserved for banks, sovereigns, and investment-grade corporations.
It legitimizes bitcoin-backed credit as a structure that can be analyzed, refinanced, and scaled — not dismissed as speculative.
It signals to other corporates and lenders that they must now understand Bitcoin not as an investment, but as collateral.
This rating does not mean the model is risk-free. It means the model is real enough to underwrite, stress test, and lend against.
That is the real inflection point — not that S&P approved of Bitcoin, but that they were forced to measure it.
Disclaimer: This content was written on behalf of Bitcoin For Corporations. This article is intended solely for informational purposes and should not be interpreted as an invitation or solicitation to acquire, purchase or subscribe for securities.
S&P Global Ratings assigned a ‘B-’ issuer credit rating to bitcoin-juggernaut Strategy, reflecting the company’s heavy concentration in bitcoin and limited dollar liquidity. The outlook is stable.
S&P said the rating reflects Strategy’s “high bitcoin concentration, narrow business focus, weak risk-adjusted capitalization, and low U.S. dollar liquidity.” The company reported $8.1 billion in pre-tax earnings in the first half of 2025, almost entirely from appreciation in the value of its bitcoin holdings.
The firm said in their release that while Strategy’s balance sheet is dominated by bitcoin, its management has prudently staggered debt maturities and maintained flexibility by financing primarily with equity.
In other words, this rating means Strategy can meet debt obligations for now but faces significant default risk if market conditions worsen.
Strategy — now effectively a bitcoin treasury company — raises capital through equity and debt issuances to purchase and hold bitcoin. Its securities give investors varying exposure to bitcoin across its capital structure.
Just today, founder and former CEO Michael Saylor announced a purchase of 390 BTC between October 20 and October 26, spending approximately $43.4 million at an average price of $111,053 per Bitcoin. The firm still operates a small AI-powered analytics business, though it remains roughly breakeven.
JUST IN: S&P Global Ratings has rated a #Bitcoin treasury company for the first time — Michael Saylor’s Strategy pic.twitter.com/oP4j5UIJlj
This S&P rating is the first-ever rating of a Bitcoin Treasury Company by a major credit rating agency.
According to S&P, Strategy’s risk-adjusted capital ratio was significantly negative as of June 30, 2025, because the agency deducts bitcoin assets from equity in its calculation.
Strategy reported $8.1 billion in pre-tax earnings in the first half of 2025. Operating cash flow during the period was negative $37 million.
The agency cited several key risks, including a currency mismatch between Strategy’s bitcoin-denominated assets and dollar-denominated obligations such as interest, debt principal, and preferred dividends.
S&P also pointed to cybersecurity risks given the company’s reliance on custodians to safeguard its bitcoin.
Strategy holds bitcoin valued at roughly $70 billion, against $8 billion in convertible debt, much of which matures beginning in 2028. Annual preferred dividends total about $640 million, which the company plans to fund through additional stock and preferred equity issuance.
While Strategy’s access to capital markets remains a core strength, S&P warned that a sharp decline in bitcoin prices or loss of investor confidence could impede its ability to refinance debt or pay dividends, potentially leading to bitcoin sales “at severely depressed prices.”
S&P said the rating could be downgraded if access to markets weakens or debt management risks rise. An upgrade is unlikely unless the company improves its U.S. dollar liquidity or reduces reliance on convertible debt.
In an interview with Bitcoin Magazine, Saylor described an “endgame” in which Strategy accumulates a trillion-dollar bitcoin balance sheet, growing 20–30% annually, and uses it as the foundation for a new global credit system.
At the core of his vision is scale: with enough BTC on corporate balance sheets, the long-term appreciation of Bitcoin — historically around 21% annually — would supercharge the capital base.
On top of that, Saylor sees an opportunity to issue bitcoin-backed credit at yields significantly higher than traditional fiat-based debt, potentially two to four percentage points above corporate or sovereign rates.
He argued that over-collateralization could make this system safer than even AAA-rated debt, while simultaneously fueling broader financial growth.
Saylor’s vision extends beyond credit markets. As Bitcoin becomes embedded in corporations, banks, insurers, and sovereign wealth funds, public equity indexes could gradually become indirect bitcoin vehicles.
This, he says, would benefit equity markets and corporate balance sheets while introducing higher yields and greater transparency into financial products.
The implications are broad: savings accounts could yield 8–10% instead of near-zero, money market funds could be denominated in bitcoin, and insurance products could be reimagined around bitcoin collateral.
Bitcoin’s price surged above $115,000 on Monday as Strategy, the largest corporate holder of Bitcoin, announced another significant purchase of Bitcoin. The business intelligence firm acquired 390 BTC between October 20 and October 26, spending approximately $43.4 million at an average price of $111,053 per Bitcoin.
According to a Form 8-K filing released today, Strategy’s total Bitcoin holdings have now reached 640,808 BTC, with an aggregate purchase price of $47.44 billion. The company’s average purchase price stands at $74,032 per Bitcoin, including fees and expenses.
The latest acquisition was funded through proceeds from Strategy’s At-The-Market (ATM) equity programs, specifically through the issuance of preferred shares under its STRF, STRK, and STRD ATM programs. The company raised a combined total of $43.4 million during the period to finance these purchases.
The announcement comes amid a growing trend of companies adopting Bitcoin treasury strategies. Recent data indicates that publicly traded companies now hold over $110 billion worth of Bitcoin, with Strategy alone accounting for approximately $74 billion of that total.
The emergence of Bitcoin treasury companies has accelerated notably in 2025, with Germany’s aifinyo AG recently announcing plans to accumulate 10,000 BTC by 2027. This follows similar moves by companies across Europe and Asia, signaling a broader institutional acceptance of Bitcoin as a treasury reserve asset.
The Bitcoin treasury model has moved from experimental to established corporate strategy. We’re seeing new companies enter this space almost weekly, recognizing Bitcoin as the ultimate treasury reserve asset.
Bitcoin’s price responded positively to Strategy’s announcement, trading above $115,000 as of press time. Bitcoin has shown strong momentum in recent days, supported by growing institutional adoption and the approaching 2026 halving.
Strategy’s stock (MSTR) has also shown positive movement, rising 3% in pre-market. Recent regulatory developments have further supported the Bitcoin treasury trend. Strategy recently received favorable guidance from the IRS and Treasury regarding the treatment of unrealized crypto gains in Corporate Alternative Minimum Tax (CAMT) calculations, eliminating concerns about potential tax liabilities for long-term Bitcoin holdings.
As more companies adopt Bitcoin treasury strategies and regulatory frameworks become clearer, the trend appears poised to continue. With Strategy leading the way and new entrants like aifinyo AG joining the space, corporate Bitcoin adoption is increasingly becoming a global phenomenon, spanning various industries and regions.
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