Bitcoin has turned red while Strategy shares rallied after MSCI announced its decision on digital asset treasury firms. The headline looked positive for Strategy but the detail was not.
Bitcoin has turned red while Strategy shares rallied after MSCI announced its decision on digital asset treasury firms. The headline looked positive for Strategy but the detail was not.
MSCI Strategy inside its global equity indices but blocked any index weight increase from new share issuance. That caps Strategy’s ability to raise equity-linked demand for Bitcoin, even as its stock jumped.
Strategy and other digital asset treasury firms will remain in its indices for now. At the same time, it will not count newly issued shares when calculating index weight. That rule matters. Strategy has relied on index-linked demand to absorb large share issuance used to buy Bitcoin.
MSCI indices anchor about $2 trillion in ETF assets. Freezing share counts limits passive inflows. MSCI also made clear that exclusion is still possible. Firms that look more like investment vehicles than operating companies remain under review. A broader consultation is coming.
Strategy stock jumped on relief that it avoided immediate index removal. Shares rose nearly 5% intraday after the announcement and 2.44% in after hours trading.
Bitcoin moved the other way. Price slipped from above $92,300 to around $90,000 at press time. Interestingly, the equity rally did not translate into spot demand for Bitcoin. The message was clear. This was a stock-specific repricing, not a crypto-wide bullish signal.
Even before MSCI’s move, Strategy’s ability to buy Bitcoin was weakening. Its stock premium over net BTC holdings has nearly vanished. At current prices, Strategy’s enterprise value to 107% of its bitcoin holdings. That leaves little room to issue shares without diluting Bitcoin per share.
To raise BTC holdings by 1%, Strategy would need to issue roughly 4 million shares, expanding share count by about 1.15%. That math works against its stated goal of growing Bitcoin per share.
Strategy can fund purchases with preferred shares, but those carry interest near 11%. That sets a high hurdle. Bitcoin must rise well above that rate for the structure to work, as per a .
The company recently raised $2.25 billion in cash through common stock sales to reduce liquidity risk. Annual interest costs sit near $831 million. Convertible bond holders could still demand early repayment on up to $6.6 billion in debt in 2027 and 2028 if the stock stays below conversion levels.
