Strategy Urges MSCI to Scrap Proposed Rule Targeting Crypto Treasuries

Michael Saylor and Phong Le, executives at Strategy, have written to MSCI urging them to drop a proposed rule that would delete the Bitcoin treasury company from their global benchmarks. The proposal, which is currently open for consultation, includes a five-flag screen measuring operating asset intensity, expenses, cash flow, fair-value swings, and dependence on external financing. Companies whose operating assets fall below half of total assets face deletion if they trip four flags.

The letter argues that the proposal is 'discriminatory, arbitrary, and misguided', and serves as a pretext for targeting digital asset treasuries. It claims that Strategy trips neither the expense flag nor the fair-value flag due to its accounting treatment of Bitcoin. Saylor and Le estimate that excluding crypto companies would have no meaningful impact on Strategy's business but would 'profoundly' harm MSCI's reputation.

The proposed rule could lead to the deletion of three companies from the ACWI IMI, including Strategy, with a float-adjusted market capitalization of $23.93 billion. Three more companies, all crypto treasuries, would be placed on a public watchlist.