MSCI finalizes rule to drop non-operating companies, marking Strategy and four others for deletion

Global index provider MSCI has finalized a rule that removes listed companies with few operating assets from its indexes, and Strategy, the largest corporate holder of bitcoin, is on the list of affected stocks. In an announcement on Oct. 15 (local time), MSCI said it will implement the proposal to classify "non-operating companies" as ineligible for its Global Investable Market Indexes (GIMI), as set out in its August consultation, with minor modifications. The change will be applied in the November 2026 Index Review and take effect as of the close of Nov. 30.

In the list of potentially impacted securities MSCI published alongside the announcement, Strategy, currently a Large Cap constituent, is marked "Deleted." The list uses financial information as of Sept. 30 and market capitalizations as of Oct. 9, and puts Strategy's issuer market cap at $43.32 billion. In a filing with the U.S. Securities and Exchange Commission (SEC) on Oct. 13, Strategy said it held 848,250 bitcoin as of Oct. 11, at an average purchase price of $75,444.

When operating assets fall below half, five ratios decide

The new rule screens in two steps. It first checks whether an issuer has substantial operating assets, meaning assets actually used to run a business, relative to total assets. According to the August consultation paper, the bar is 50%. Issuers that fall short are then tested on five non-industry-specific financial ratios: operating asset intensity, expense intensity, whether operating cash flow is negative, how large fair value changes are relative to sales and assets, and how much the company relies on external financing to accumulate assets. A company flagged on four or more of the five is ineligible for index inclusion.

Buffers are built in to limit turnover. A non-constituent cannot be added if it fails the screen in either of its two most recent annual filing periods, while a current constituent is removed only if it fails in each of the two most recent annual periods. MSCI said it may also use the most recent interim filing. The final thresholds are set out in an appendix to the GIMI methodology.

Strategy, Metaplanet among five marked 'Deleted'

The five stocks marked "Deleted" are Strategy, U.K. uranium holder Yellow Cake, Japan's Metaplanet, Iceland's Skel and U.S.-based Upexi. Metaplanet sits in the small-cap segment with a float-adjusted market cap of $803.9 million. In a simulation using May data in the August paper, only three companies, Strategy, Yellow Cake and Metaplanet, were set for deletion, so the new list adds two. That simulation put Strategy's float-adjusted market cap at $23.93 billion and placed three companies on the watchlist: Taiwan's Center Laboratories, Turkey's Lydia Holding and SharpLink. The first two are no longer on the list.

The 17 watchlist names include ether treasury company SharpLink as well as several companies built around holding crypto, such as SUI Group Holdings, TON Strategy, Solana Company, DeFi Development and France's Capital B. Watchlist companies stay in the indexes for now but can be removed if they fail again at the next annual review. MSCI will publish the final list on Nov. 11 as part of its November 2026 Index Review announcement.

MSCI backed off in January, then came back with a wider rule

On Jan. 6, MSCI dropped its plan to exclude only digital asset treasury companies and said it would launch a broader review of how non-operating companies should be treated. Strategy shares rose about 6% in after-hours trading at the time. MSCI has since applied interim measures to companies on its preliminary list whose digital asset holdings made up 50% or more of total assets, freezing increases in their number of shares and inclusion factors and deferring additions and size-segment migrations. With this announcement, those measures end with the November review, and the companies will be assessed under the new methodology.

Strategy posted its objection on its official X account on Aug. 14, while the consultation was underway.

"Digital assets are assets. Index providers should measure markets, not decide which assets companies are allowed to own."

Strategy's official X account

After the announcement, at around 10:32 a.m. KST on Oct. 16, bitcoin traded at 111,208,000 won on Upbit and $82,269 on Binance. The kimchi premium (the gap between prices on Korean exchanges and global markets), measured on Upbit against the Binance price converted to won using Coinyong's price feed, was about 0.7%.