Strategy, formerly known as MicroStrategy, has issued a strong response to the critical advisory process by MSCI that could significantly impact companies holding Bitcoin (BTC) as a strategic asset on their balance sheets.
The company formally submitted its opinion against MSCI’s proposed plan to remove Digital Asset Treasury Companies (DATs) from its Global Investable Market Indexes. Strategy argues that this proposal is "arbitrary, discriminatory and policy-driven."
It is estimated that a delisting of Strategy from these indices could lead to an outflow of approximately $8 billion in assets.
Strategy's Arguments Against MSCI's Proposal
In a detailed letter addressed to MSCI, Strategy emphasized that DATs should not be categorized as mutual funds. Instead, they operate as active, operational companies. The company stated, "DATs are not passive Bitcoin funds; they actively use Bitcoin to create value for shareholders." Strategy further noted its ongoing development of innovative Bitcoin-backed digital lending products, drawing parallels to financial products historically offered by traditional banking and insurance institutions.
Strategy contended that MSCI's proposed rule, which suggests exclusion from the index if "50% of the balance sheet is comprised of digital assets," represents a discriminatory practice specifically targeting this emerging sector. The company highlighted that other companies heavily concentrated in a single asset class, such as oil, gold, real estate, or media, do not face similar exclusionary treatment.
The letter also raised concerns about the practical enforceability of the proposed rule. Strategy pointed out that fluctuations in asset prices, variations in accounting rules, and differences in international reporting standards would likely cause DATs to frequently enter and exit the index, leading to significant market instability.
Impact on Market Impartiality and Innovation
Strategy asserted that MSCI's core mission is to reflect financial markets impartially. However, the company argued that the current proposal specifically targets a particular asset type and incorporates policy considerations directly into the index methodology. This approach, Strategy believes, would compromise MSCI's standing as an impartial index provider and potentially create confusion among investors.
Furthermore, Strategy argued that the proposal runs counter to the United States' objective of fostering leadership in digital asset technologies. It suggested that such a move would stifle investment and innovation within the sector. The company underscored the potential for Bitcoin and other digital assets to play a crucial role in the future of global financial infrastructure, making this a particularly inopportune time to exclude companies involved in this space.
Michael Saylor's Statement
Strategy Chairman Michael Saylor also publicly voiced his opposition to MSCI's plan. In his announcement, he stated:
"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 encouraged the broader community to review the submitted letter and lend their support to the cause.
Call for a Mature Evaluation Process
Strategy formally requested that MSCI withdraw the proposal entirely. Instead, the company recommended that MSCI follow a more comprehensive and mature evaluation process, similar to the approach taken when establishing the "Communications Services" sector. This, Strategy stated, should involve years of thorough evaluation, sector maturation, and extensive public consultation processes.