American financial services company MSCI’s October consultation on “digital asset treasury companies” arrived at a time when the mechanics of Bitcoin (BTC) exposure had already begun to fracture.
By mid-2025, three roughly equal-sized channels funneled institutional capital into BTC: regulated spot ETFs managing north of $100 billion, mining operations with embedded BTC exposure, and a newer cohort of public companies whose primary business had become holding crypto on their balance sheets.
MSCI’s proposal targets the third bucket and, in doing so, forces a reckoning over whether these firms are operating companies or passive funds in corporate costumes.
The proposal itself reads like standard index housekeeping.
MSCI floated excluding from its Global Investable Market Indexes any company whose digital-asset holdings exceed 50% of total assets, and invited feedback on whether firms that self-identify as digital asset treasuries or raise capital primarily to stack Bitcoin should face similar treatment.
The consultation window runs through Dec. 31, with a decision due Jan. 15 and implementation penciled in for the February 2026 review.
MSCI frames the question explicitly: do these stocks “exhibit characteristics similar to investment funds,” which already sit outside equity benchmarks?
JPMorgan answered by modeling the fallout. Its November analysis pegged Strategy’s market cap at roughly $59 billion, with about $9 billion held by passive vehicles tracking major indexes.
In a scenario in which MSCI alone reclassifies Strategy, roughly $2.8 billion in passive assets would be forced to sell. If Russell and other providers follow, mechanical outflows could reach $8.8 billion, according to a Barron’s estimate.
The amount is framed as the second index shock after Strategy’s earlier exclusion from the S&P 500, and it triggered a backlash. JPMorgan faced scrutiny over front-running, with public calls to boycott the bank and to short its stock.
The proxy-stock problem
The anger reflects a deeper tension over how Bitcoin beta enters traditional portfolios. DLA Piper’s October advisory documented the sector’s explosive growth.
More than 200 US public companies had adopted digital asset treasury strategies by September 2025, holding an estimated $115 billion in crypto and sporting a combined equity market cap of around $150 billion, up from $40 billion a year earlier.
This is roughly 190 focused on Bitcoin treasuries, with another 10 to 20 holding other tokens. For institutions constrained by mandates that prohibit direct crypto holdings, these stocks offered a workaround: tracking BTC through equity exposure without breaching compliance guardrails.
However, that convenience came with structural vulnerabilities. Many newer treasuries financed their purchases through convertible notes and private placements, and when their stock prices fell below the value of the crypto they held, boards faced pressure to sell coins and buy back shares.
Digital asset treasuries deployed about $42.7 billion into crypto in 2025, with $22.6 billion in the third quarter. Solana-focused treasuries saw their aggregate net asset value drop from $3.5 billion to $2.1 billion, a 40% drawdown, setting up forced liquidations that could amount to $4.3 billion to $6.4 billion if even a modest fraction of positions unwind.
At the same time, spot Bitcoin ETFs crossed $100 billion in assets under management less than a year after launch, with BlackRock’s IBIT alone holding over $100 billion in BTC and roughly 6.8% of the circulating supply by late 2025.
The products offered purer exposure without balance-sheet leverage or the NAV discount problems plaguing treasury stocks.
MSCI’s consultation accelerates a rotation already underway. BTC exposure migrates from treasury equities, which become forced sellers when equity valuations crack, into regulated ETF wrappers.
For Bitcoin itself, the rotation can be neutral or even positive if ETF inflows offset treasury selling; for the stocks, it’s unambiguously liquidity-negative.
For BTC dominance, it arguably reinforces Bitcoin’s structural advantage: the products institutions rotate into are almost entirely BTC-only. At the same time, some treasuries had started experimenting with Solana, Ethereum, and other tokens.
| Company | Ticker | Role in BTC exposure | MSCI status in DAT review | Approx MSCI parent-index weight* | At-risk passive AUM (order of magnitude) | Liquidity note |
|---|---|---|---|---|---|---|
| Strategy | MSTR | Digital-asset treasury BTC | Flagged as core DAT candidate | ≈ 0.02% of MSCI ACWI IMI | ≈ $2.8B MSCI-linked; up to ≈ $8–9B total | Main node for forced selling; proxy for BTC beta in equities. |
| Riot Platforms | RIOT | BTC miner / proxy stock | Listed on preliminary DAT list | Very small; fill from terminal | Hundreds of millions, not billions | Liquidity-sensitive; high ETF/thematic ownership share. |
| Marathon Digital | MARA | BTC miner / proxy stock | Listed on preliminary DAT list | Very small; fill from terminal | Hundreds of millions, not billions | Similar profile to RIOT; more volatile free float. |
| Metaplanet | 3350 | BTC treasury (Japan) | MSCI has frozen upgrades/changes | Tiny; small-cap / country index | Tens of millions | Non-US example; shows global reach of rule. |
| Capital B and other DATs | Various | BTC-heavy DATs / miners | On wider 30–40 name DAT watchlist | Tiny individually | Collective “long tail” | Together, form a second tier of liquidity risk. |
Liquidity under stress
The equity-side mechanical flows are straightforward. Index funds benchmarked to MSCI cannot replace Strategy with a Bitcoin ETF. They rotate into whatever fills the index slot.
From BTC’s perspective, this is an equity-liquidity shock, not an automatic coin-selling shock, yet the second-order effects matter more.
Treasury companies facing weaker equity support and tighter funding conditions will either scale back future purchases or, in some cases, liquidate holdings to shore up their balance sheets.
Strategy has signaled it won’t sell BTC to stay under any threshold; instead, it’s reframing itself as a “Bitcoin-backed structured finance company,” doubling down on the idea that it’s an operating business, not a fund.
Smaller treasuries with weaker balance sheets may lack that luxury.
Russell and FTSE Russell have not launched formal consultations on digital asset treasuries, but JPMorgan’s $8.8 billion outflow scenario assumes other major providers will converge on MSCI’s treatment over time.
FTSE Russell remains deeply involved in digital-asset indexing on the token side. However, its equity methodology does not yet carve out treasuries as a separate category, they’re still treated like sector stocks.
DLA Piper’s advisory reads as a warning that regulators and gatekeepers, including indexers, are reviewing treasury disclosures more closely, which supports the plausibility of a copycat wave even if it hasn’t started.
MSCI’s move forces institutions to decide whether Bitcoin belongs in equity benchmarks or in dedicated crypto products.
The consultation is methodological, but the stakes are structural: it determines whether BTC beta sits in ETFs and a handful of large corporate treasuries, or in a more dispersed ecosystem of smaller balance-sheet holders who become forced sellers when markets turn.
The answer reshapes not just index weights, but the concentration of Bitcoin ownership itself.
