Strive, which ranks as the 14th-largest publicly traded Bitcoin treasury firm on Nasdaq, has called on MSCI to reevaluate its proposed move to exclude significant Bitcoin-holding companies from its indexes.
In correspondence addressed to MSCI’s chairman and CEO, Henry Fernandez, Strive articulated that removing companies with over 50% of total assets in digital holdings would diminish passive investors’ access to growing sectors and would fail to accurately represent the companies in question.
A loss of inclusion in MSCI indexes could pose a substantial setback for digital asset treasury firms. Analysts from JPMorgan previously cautioned that Strategy, a Bitcoin treasury firm featured in the MSCI World Index, could face a loss of $2.8 billion if MSCI advances with the proposal.
Michael Saylor, chair of Strategy, has noted that the company is in discussions with the index provider concerning this matter.
Large Bitcoin holders lead the AI charge: Strive CEO
Matt Cole, CEO of Strive, emphasized that leading Bitcoin miners like MARA Holdings, Riot Platforms, and Hut 8—potential candidates for exclusion—are rapidly evolving their data centers to support the infrastructure needs of AI computing.
“Numerous analysts suggest that the barriers to AI advancement are more tied to power availability than semiconductor access. Bitcoin miners are ideally positioned to fulfill this growing demand,” he stated.
“Furthermore, even as AI-related revenues increase, their Bitcoin assets will persist, and your exclusion would limit client involvement in the swiftest-expanding sector of the global economy.”
Bitcoin structured finance on the rise
The proposed exclusion would also affect firms like Strategy and Metaplanet, which provide investors with products comparable to structured notes linked to Bitcoin’s returns from established firms like JP Morgan, Morgan Stanley, and Goldman Sachs, Cole argued.
“Bitcoin structured finance constitutes a bona fide business for us, just as it does for JPMorgan. Indeed, like other Bitcoin enterprises, we have been transparent about our aspirations to make this our primary focus. It would be unfair for us to compete against traditional financiers, encumbered by increased capital costs stemming from passive index providers’ penalties impacting the very Bitcoin that supports our offerings.”
A 50% Bitcoin threshold proves impractical
Cole asserted that the proposal is unlikely to be practical, as linking index inclusion to a volatile asset would cause companies to “flicker” in and out of the index, inflating management costs and increasing tracking errors.
Additionally, there’s the challenge of determining when digital asset holdings reach the 50% mark, especially as companies gain exposure to digital assets via various instruments.
Related: Michael Saylor from Strategy discusses possible MSCI exclusion: ‘We’re in talks’
“This isn’t just a theoretical issue. The Trump Media & Technology Group Corp., which holds the tenth-largest public Bitcoin treasury, was absent from your preliminary exclusion list because its Bitcoin holdings accounted for just under 50% of total assets,” Cole remarked.
“However, Trump Media’s omission isn’t merely due to it being the first large treasury to seek significant digital asset exposure through derivatives and ETFs.”
Rather than enforcing a blanket exclusion, Strive has urged MSCI to consider developing an “ex-digital asset treasury” variant for its current indexes.
“Asset owners wishing to avoid these companies could opt for those benchmarks, while others could continue using the standard indices that best reflect the entire investable equity landscape.”
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