Bitcoin Policy Institute Examines MSCI Index Exclusion Proposal

The Bitcoin Coverage Institute, a non-partisan, non-profit suppose tank, launched a paper on September 30 inspecting MSCI’s proposal to display sure firms from its International Investable Market Indexes based mostly on whether or not they meet proposed standards for working exercise.

The paper, titled “Wall Road’s Invisible Committee” and authored by Conner Brown, critiques the proposal’s improvement, associated public statements by MSCI, and its doable utility. Based on the paper, MSCI stories $21 trillion in property benchmarked to its indexes. Adjustments to methodology can require funds monitoring these indexes to regulate holdings, doubtlessly shifting billions of {dollars}. 

Proposal historical past and metadata findings

In 2025, MSCI proposed excluding Digital Asset Treasury Corporations holding at the very least half their property in digital property from its International Investable Market Indexes. After opposition, MSCI shelved the proposal in January 2026. 

It later returned with a broader check for non-operating firms based mostly on working property and 5 monetary ratios. MSCI’s simulation utilizing Could 2026 information would exclude Technique, Metaplanet, and Yellow Cake plc, an organization that holds uranium.The institute examined the general public session PDF and recognized embedded metadata. 

The paper states that whereas metadata alone can not show the result was predetermined, it raises a query about whether or not the standards had been developed for constant classification or to succeed in the identical exclusions via a broader rule.

Public feedback on the present proposal closed on September 30, with a choice anticipated by October 16. If adopted, the adjustments are proposed to take impact as a part of the November 2026 Index Evaluate.

Earlier statements on cryptocurrency

The paper traces MSCI’s public file to an October 2021 article titled “Creeping Crypto.” In it, MSCI warned about cryptocurrency publicity coming into fairness portfolios, described most cryptocurrencies as speculative investments with little evident utility, and flagged Bitcoin’s Proof of Work as environmentally harmful. 

It recognized at the very least 52 public firms with cryptocurrency publicity, together with 26 constituents of the MSCI ACWI Index. Technique, then generally known as MicroStrategy, appeared on the backside of the governance-score rating proven within the article.

CEO Henry Fernandez has publicly said the significance of ESG investing. In 2021, he recounted urging bankers to refuse to take an organization public or do a bond providing with no net-zero pledge. MSCI’s then-head of indexes described an ambition for its flagship world index to grow to be inexperienced, one firm at a time. 

Management mixed duty for ESG and index governance. The paper notes these statements don’t show the motive behind the present proposal however increase a governance query concerning the boundary between advocacy and broad-market index selections.

Based on the paper, the proposed check depends on working property with no standardized classification framework underneath U.S. GAAP or IFRS. The paper analyzes how interpretations might apply to property reminiscent of a satellite tv for pc awaiting launch, a mine underneath building, or capital raised to construct a manufacturing unit. 

It states that the discretion might have an effect on rising industries. MSCI has maintained that an index is a mathematical calculation that doesn’t channel investments and that it expresses no opinion on whether or not any firm or funding is sweet or dangerous. Index suppliers aren’t regulated as funding advisers.

Firm responses on the proposal 

In feedback submitted on September 25, Try Chairman and CEO Matt Cole requested MSCI to clarify how it will decide whether or not property type a part of an organization’s working enterprise underneath the proposed methodology. Cole questioned functions to firms that use monetary property in lending, structured finance, and asset administration. 

Technique, in a letter dated August 31 signed by Government Chairman Michael Saylor and President and Chief Government Phong Le, said it does not fail the proposed exclusion screen. The corporate mentioned it has not triggered 4 of the 5 financial-ratio flags. Technique mentioned it data $22.77 billion of Bitcoin fair-value adjustments inside working bills; excluding that line, it mentioned working bills would equal 0.37% of complete property. 

The letter described the proposal as a repackaging of the sooner digital-asset-specific rule withdrawn on January 6, 2026, which drew opposition from greater than 250 organizations and 1,500 signatories. Technique famous that the phrases “working” and “non-operating” seem in no U.S. GAAP or IFRS customary and that no accounting framework or different index supplier makes use of the 5 proposed ratios. 

It mentioned MSCI has not engaged with the corporate within the eight months since withdrawing the primary proposal and requested MSCI to withdraw the session.

The Bitcoin Coverage Institute paper supplies suggestions for policymakers, together with a presumption of inclusion for lawful, liquid, investable equities in broad-market indexes and clear, reproducible standards for any categorical exclusions.

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