MSCI Reviews New Index Inclusion Criteria, Potential Exclusion of Strategy and Metaplanet

Morgan Stanley Capital International (MSCI) is exploring new criteria for index inclusion. There are concerns that Strategy and Metaplanet, companies in the digital asset finance (DAT) sector, may be excluded under the current standards. MSCI indices are used as benchmarks for ETFs and pension fund management, and exclusion could lead to significant capital outflows. MSCI is categorizing non-operating companies into investment funds and regular enterprises, with new criteria established to filter out non-operating firms. Characteristics of non-operating companies include accumulation of non-operating assets, lack of cash generation, dependence on market price fluctuations, and reliance on external capital. If these criteria are applied, Strategy and Metaplanet could be excluded, as they are BTC DAT companies. In contrast, Sharplink, an ETH DAT company, may be classified as a watchlist item. If excluded from the MSCI index, large passive funds would need to sell their holdings, potentially creating additional selling pressure. The new MSCI criteria have not yet been finalized and are expected to be implemented starting in November after the results are announced on October 16.

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