Global index provider MSCI is considering excluding digital asset treasury companies (DATs) from its benchmarks, a move that analysts warn could create significant selling pressure on crypto-heavy firms like MicroStrategy.

Consultation Underway
MSCI announced in October it is consulting investors through December 31 on whether to exclude companies with more than 50% of their balance sheets in crypto assets. The feedback suggests DATs may "exhibit characteristics similar to investment funds," which are currently ineligible for index inclusion.

Charlie Sherry, Head of Finance at BTC Markets, believes exclusion is likely, noting MSCI "only puts changes like this into consultation when they're already leaning that way." A final decision will be announced January 15, with any changes taking effect in February.

Potential Market Impact
If DATs are excluded, index-tracking funds would be forced to sell holdings in approximately 38 identified companies, including MicroStrategy, Sharplink Gaming, Riot Platforms, and Marathon Digital Holdings.

JPMorgan analysts warned MicroStrategy could see $2.8 billion in outflows, with roughly $9 billion of its $56 billion market value held by passive funds tracking MSCI indexes.

Broader Implications
Sherry characterized the potential move as a "risk-management decision" that reflects a market shift away from celebrating crypto-heavy corporate strategies toward more conservative filters. While unclear if other index providers would follow suit, Sherry noted S&P has already taken a stricter view of MicroStrategy.

Despite short-term pressure, Sherry argued clearer classification rules ultimately benefit crypto by "removing uncertainty for both issuers and investors" and strengthening long-term institutional confidence.