MSCI delays removing Bitcoin asset companies, resolving the crisis of hundreds of billions in passive fund withdrawals

Beijing time January 7th, a statement from MSCI (Morgan Stanley Capital International) triggered a sharp market reaction. The world’s largest index provider announced a suspension of the policy adjustment originally scheduled for February, meaning it will no longer proceed with removing “digital asset financial companies” such as Strategy from its global index system. This shift is widely interpreted as a significant positive signal for Bitcoin financial companies and marks a key turning point in the traditional financial system’s attitude toward listed entities related to crypto assets.

Key Details of the Policy Shift

MSCI’s decision changed the market’s previous concerns. The planned removal in the February index review has now been “suspended,” and the process has shifted toward initiating a broader consultation. This means that digital asset financial companies (DATCOs) already included in MSCI indices will continue to retain their index positions, at least until the next formal review is completed.

Background of the Policy Adjustment

According to quick news, MSCI received important feedback from investors, highlighting a core issue: some digital asset financial companies are structurally and risk-wise closer to investment funds, which are typically excluded under traditional index rules. This has triggered a critical classification dilemma—how to distinguish between companies that hold digital assets for operational purposes and investment entities that hold digital assets primarily for investment.

MSCI indicated that future standards might need to incorporate new judgment criteria, including indicators based on financial statement structures, asset usage, and business models. This effectively means that the world’s most important index system is being forced to re-examine and redesign its rule framework.

Market Reaction Intensity

This policy shift immediately caused noticeable reactions in after-hours trading in the US stock market. Strategy (MSTR) rose 7.17%, BitMine (BMNR) increased 2.10%, and SharpLink Gaming (SBET) gained 1.59%. While these gains are not huge, they clearly reflect the direct impact of passive fund retention expectations on market sentiment.

For large institutional funds tracking MSCI indices, the stability of index components is crucial. Any removal decision implies forced selling, while any retention decision means holding the position.

How Big Is the Avoided Risk

To understand the significance of this shift, it’s important to see what could have happened. According to JPMorgan estimates, just one company, Strategy, could have experienced passive fund outflows of up to $2.8 billion. If all companies labeled as “digital asset financial companies” were included, the potential concentrated passive outflows could reach $10-15 billion.

This is not just a numerical issue. Large-scale concentrated withdrawals of passive funds often trigger a stampede of selling, exerting downward pressure on stock prices that often exceeds fundamental changes. MSCI’s decision effectively helped the market avoid a potential liquidity crisis.

Reversal of Market Expectations

Data from the prediction market Polymarket clearly reflects this shift in expectations. Before MSCI announced the suspension, the probability of Strategy being removed from the index was high. After the announcement, this probability instantly dropped to 11%. This sharp decline vividly demonstrates the market’s confidence in the policy shift.

Analysts’ views on this shift are also relatively positive. Benchmark’s Mark Palmer stated, “MSCI’s decision provides Strategy with a welcome breathing space.” However, Lance Vitanza from TD Cowen was more cautious, noting, “It’s still uncertain whether this represents a victory for the defensive side or is just a temporary delay.”

This Is Not the End, But a Turning Point

It’s important to clarify that MSCI’s decision is not final. The company explicitly stated that a new formal review will be conducted in February 2026. This means that while short-term pressures are alleviated, long-term uncertainties still exist.

MSCI is also initiating a broader consultation regarding the treatment of non-operational companies. This process involves communication with market participants and the development of standards, which is expected to take time. In other words, this “pause” provides a valuable window for Bitcoin financial companies to improve their business structures and financial performance.

Redesign of Policy Standards

From a broader perspective, MSCI’s policy adjustment reflects a deeper issue: the traditional financial system’s rule framework is being forced to confront the long-term existence of new listed entities like Bitcoin financial companies. This is not just an index issue but a signal of changing recognition of the crypto asset ecosystem by global capital markets.

For the entire crypto asset industry, this signal means that even the most conservative traditional financial institutions are beginning to acknowledge the legitimacy of such companies and are willing to develop appropriate rules rather than simply exclude them.

Summary

MSCI’s suspension of the removal of Bitcoin financial companies temporarily alleviates the risk of hundreds of billions of dollars in passive fund outflows and changes market expectations regarding these companies. But this is not the final outcome—the February review and the development of policy standards will ultimately determine the direction.

For institutions holding related stocks, this is a rare breathing space. For the entire crypto asset ecosystem, it signals increasing acceptance by traditional finance. However, all participants should remain vigilant and rational, as policy directions can change at any time. The key moving forward is to observe how MSCI formulates new evaluation standards and how relevant companies optimize their business structures within this time window.