MSCI’s Potential Changes to Global Investable Market Indexes
MSCI is contemplating changes to how it evaluates companies for inclusion in its Global Investable Market Indexes, potentially affecting the status of two specific firms—Strategy and Metaplanet—during the upcoming Index Review scheduled for November 2026. A recent analysis conducted on data from May indicated that these companies, along with Yellow Cake, a uranium investment firm based in the U.K., may be removed from the index if the proposed methodology is approved.
Consultation Phase and Stakeholder Feedback
The current consultation phase allows for stakeholder feedback until September 30, with MSCI aiming to report back on findings by October 16. It is important to note that this consultation may or may not lead to actual changes in the index, as MSCI has explicitly stated that no definitive decisions have yet been made.
Re-evaluation of Digital Asset Holdings
This re-evaluation is part of a broader examination of digital asset holdings which initially sought to exclude treasury companies reliant on cryptocurrencies, a move that was previously abandoned due to investor concerns about the criteria being overly simplistic. Companies like Strategy criticized the earlier proposal of a 50% digital asset threshold, labeling it as “arbitrary.” The new methodology, however, promises a more nuanced approach, applying financial metrics universally across sectors instead of singling out cryptocurrency firms.
Proposed Methodology for Evaluation
Under the proposed model, firms would first be evaluated with a two-step test; those with operating assets that constitute over 50% of total assets would automatically qualify for retention. In contrast, firms failing this first criterion would undergo a second layer of scrutiny based on several financial factors including cash flow and operational reliance. If any company meets four out of five indicators that suggest it functions as a non-operating entity, it would be marked for removal.
For those currently included in the index, the thresholds would be gradually less stringent, necessitating two consecutive annual failures for a company to be dropped, while new applicants would only need to fail one review to be disqualified.
Projected Impact on Companies
Based on May data, the analysis projected that Strategy, with a market cap adjusted for free float around $23.93 billion; Yellow Cake at approximately $1.81 billion; and Metaplanet valued at $654 million could all be removed from the index. Notably, other companies like SharpLink, Center Laboratories, and Lydia Holding would remain under observation for potential deletion since they only displayed a single instance of failure according to MSCI’s criteria.
SharpLink is particularly interesting as it operates in the crypto treasury space and reported holding over 888,000 ETH equivalents as of August 3, citing equity financing as a major liquidity source. However, the implications of any removals are significant for funds tracking these indices, necessitating portfolio adjustments. Despite earlier analyses suggesting that the removal of Strategy could prompt passive sales upwards of $2.8 billion, these figures reflect outdated proposals and should not be interpreted as projections for the current methodology.
Current Holdings and Future Updates
Strategy is continuing to leverage its substantial Bitcoin holdings, reporting 840,447 BTC as of August 9, and has involved itself in multiple financial maneuvers including selling Bitcoin to repurchase stock. Conversely, Metaplanet also maintains a significant amount of Bitcoin, claiming 43,000 BTC at this time. The relationship between these companies and MSCI began in February 2025 when they were incorporated into the MSCI Japan Index.
While no definitive action has been taken under the new methodology thus far, updates from MSCI are expected in the coming months. The institution’s August Index Review was published on August 12, with adjustments being implemented post the market close on August 31, while the evaluation of the non-operating company proposal is slated for November. The critical upcoming date is September 30, marking the deadline to submit feedback on the consultation, with final decisions due by mid-October. Any deletions identified in this latest proposal would be reflected during the November 2026 review. However, stakeholders should be cautious in interpreting the May simulation as it does not guarantee the fate of the companies involved; financial conditions are subject to change over time, and MSCI will be applying annual data to any final decisions.
