Strategy (MSTR.US) Faces Potential Removal from MSCI Index, Passive Funds May Sell $2.8 Billion

According to Woofun AI, Strategy (MSTR.US) stated in its third-quarter report submitted to the SEC that its Class A common stock is expected to be removed from the MSCI Global Investable Market Index (GIMI) in November 2026.

This decision stems from MSCI (MSCI.US) announcing new standards on October 15, reclassifying companies whose core business is holding investment assets as "non-operating companies" and permitting their removal. However, according to the rules, current constituents must fail the relevant screening for two consecutive fiscal years before removal occurs, so the final outcome remains unconfirmed. As the announcement of assessment results at 11:00 p.m. CET on November 11 draws near, the market is closely watching the subsequent index adjustment, which will take effect after the close of trading on November 30 and be officially implemented on December 1. This is seen as a major liquidity stress test for the world’s largest enterprise-level BTC holder.

From a capital flow perspective, passive funds' rebalancing operations will be the direct source of impact. JPMorgan (JPM.US) estimates that if the removal becomes a reality, funds tracking the index could sell approximately $2.8 billion (about 3.7461 trillion KRW) worth of Strategy stock.

It is noteworthy that this selling pressure only targets the equity, not the underlying BTC assets, since the index rules do not require funds to dispose of the BTC held by Strategy. However, if other major index providers follow suit, the scale of outflows could expand further—JPMorgan calculates that if several index providers coordinate removals, the total amount could reach as much as $8.8 billion.

According to Woofun AI’s compiled data, Strategy purchased 1,036 BTC at an average price of $79,012 between November 2 and 8, spending about $81.9 million. This brought its total holdings to 850,364 BTC, cumulative acquisition cost to $6.4165 billion, and overall average cost up to $75,456.

This continued accumulation, against the backdrop of index-related headwinds, highlights the tension between management’s commitment to long-term value and short-term market volatility.

The more critical variable lies in the dual squeeze of asset valuation and financing capability. As of the 11th, the spot price of BTC had fallen to $73,774, below Strategy’s average acquisition cost of $75,456, meaning its assets are now at an unrealized loss. The market is concerned about a negative feedback loop formed by "Bitcoin price falling below average cost" and "index removal triggering sell-offs": passive selling puts downward pressure on the stock price, which in turn worsens conditions for raising capital through issuing more shares, ultimately undermining its ability to continue buying BTC.

This indirect pathway is more destructive than the index removal itself, as a tighter funding channel directly limits Strategy’s core growth engine. Although the company is not immediately required to sell BTC, increased financing costs resulting from a declining stock price may force a slowdown in future capital expenditure plans.

MSCI’s final list is expected to be announced on the morning of the 12th Korea time. If Strategy is removed as scheduled, the actual passive fund rebalancing activity will erupt around the close of U.S. trading on November 30. This marks a substantive adjustment in the traditional index compilation logic toward “coin-hoarding” enterprises, following the debates surrounding crypto asset compliance. Short-term liquidity shocks are unavoidable, but the long-term impact depends on whether the BTC price can stabilize above the $75,456 cost line and whether Strategy can maintain its market position as the preferred leveraged BTC exposure vehicle outside the index.