Morgan Stanley Capital International (MSCI) will decide today whether Strategy (MSTR) stays in its indexes or faces removal. If MSCI removes the stock, passive funds could sell up to $2.8 billion worth of shares by 30 November.
The decision could also make it harder for Strategy to raise money to buy more Bitcoin, as BTC price continues to trade near $73K.
Strategy May Fail MSCI’s Screening Test – Here’s How
On 15 October, MSCI introduced a new screen for companies that may operate more like investment vehicles than traditional businesses. Five companies are currently on MSCI’s potential removal list.
They include Strategy Inc (MSTR), Japanese Bitcoin treasury firm Metaplanet, Yellow Cake, Skel Fjarfestingafelag and Upexi.
However, Strategy fits properly into MSCI’s non-operating company exclusion criteria, and its Q3 2026 financial results also show why it could fail MSCI’s screening rules.
Step 1: Check the company’s operating assets
MSCI first checks whether at least 50% of a company’s total assets come from its regular business operations.
In Q3 2026, Strategy reported $74 billion in total assets, including $68.9 billion in Bitcoin (848,517 BTC) and $5.1 billion in cash reserves. Its software business makes up only a very small part of its total assets. This means Strategy could fail MSCI’s first test.
Step 2: Five more financial tests
If a company fails the first test, MSCI checks five more financial measures. These look at the size of its business, cash flow, changes in asset values, and reliance on outside funding. A company must fail at least four of these five tests to be excluded.
Strategy’s Q3 results raise concerns in two areas:
Large changes in asset value: As Strategy reported $20.9 billion in operating income in Q3 2026, mostly from a $20.9 billion gain in the value of its Bitcoin holdings as BTC rose from $58,700 to $83,600.
Reliance on outside funding: Strategy continues to raise money through stock and preferred share sales to buy Bitcoin and pay dividends, instead of relying on income from its software business.
Strategy itself acknowledged the risk in its Q3 filing, stating that,
“Based on these criteria, we expect our Class A common stock to be excluded from the MSCI Global Investable Market Indexes.”
How Many MSTR Shares Will Be Sold?
If MSCI removes MSTR from its indexes, passive funds could sell between 13 million and 23.1 million shares, worth around $1.57 billion to $2.8 billion. However, index funds would need to sell their MSTR shares by 30 November if MSCI confirms the removal.
JPMorgan analysts estimate that MSCI removal alone could lead to $2.8 billion in passive fund selling.
If other major index providers, such as FTSE Russell and S&P/Nasdaq, introduce similar rules, total selling could reach $8.8 billion.
What MSTR Removal Could Mean for Bitcoin
While the selling would primarily affect MSTR and its shareholders, it would not affect Strategy’s Bitcoin holdings. The bigger Bitcoin issue is indirect.
Strategy has continued using equity financing to support its Bitcoin strategy, including its latest purchase of 1,036 BTC funded partly through MSTR sales.
MSCI removal would not force a Bitcoin sale, but could reduce the capital available for Strategy’s future Bitcoin purchases.