MSCI Will Remove Strategy as JPMorgan Sees Up to $8.8B in Potential Outflows

MSCI will remove Strategy and Metaplanet from its global indexes, a decision that could prompt passive funds to sell shares in major Bitcoin treasury companies.

The changes also include Yellow Cake, a British uranium investment firm, and Metaplanet, a Japanese Bitcoin treasury company. MSCI’s new screen applies to companies it considers more like investment funds than operating businesses. Potential sales would come from passive investors adjusting index holdings.

Strategy previously warned that its removal could put about $2.8 billion in company shares up for sale. JPMorgan previously estimated Strategy could face as much as $8.8 billion in outflows if other index providers adopted a similar approach. The higher estimate depends on index providers beyond MSCI making comparable changes.

Strategy shares fell 2.5% in Wednesday after-hours trading after the announcement. Ether (ETH) treasury company SharpLink (SBET) is on MSCI’s watchlist, rather than among the companies slated for removal. The index removals take effect Dec. 1.