MSCI, one of the world's largest stock index providers, is removing MicroStrategy's MSTR shares from its MSCI USA Index effective after November 30. The removal also affects broader global benchmarks including the MSCI World and MSCI All Country World indexes.
The decision does not delist MicroStrategy from the Nasdaq or require the company to sell its Bitcoin holdings. Rather, it removes the stock from index lists that investment funds use to determine portfolio holdings. Funds designed to track the MSCI USA Index will generally need to sell their MSTR shares following the removal.
Why MSCI Is Making the Change
MSCI adopted new rules in October targeting non-operating companies—businesses that primarily hold financial assets rather than generate revenue from operations. The index provider uses screening criteria based on operating assets and other financial measures to identify such companies.
MicroStrategy argues the classification is unfair. In an August letter to MSCI, the company called the proposal "discriminatory, arbitrary, and misguided," asserting that its capital-raising activities, Bitcoin treasury management, and financial products constitute a genuine operating business. MSCI has not detailed which specific tests MicroStrategy failed.
The Financial Reality
MicroStrategy reported $19.53 billion in net income for its latest quarter, but nearly all of this came from increases in the accounting value of its Bitcoin holdings rather than revenue from operations. Under accounting rules adopted in 2025, changes in Bitcoin's market price flow through the company's earnings even when coins are not sold.
The company's software division, its traditional operating business, recorded $125.4 million in quarterly revenue, down 3 percent from the prior year. Full-year 2025 software revenue of $477.2 million was slightly below the $486.3 million reported in 2019, before the company began its significant Bitcoin acquisition strategy.
Potential Market Impact
The removal could create selling pressure on MicroStrategy's stock. The company estimates that funds linked to MSCI indexes hold approximately 13 million of its shares, representing 3.1 percent of outstanding common stock. MicroStrategy describes this amount as manageable.
The broader concern centers on the company's funding model. MicroStrategy has historically raised capital by issuing shares and securities, then using the proceeds to purchase Bitcoin. A declining stock price would require the company to issue more shares to raise the same amount of capital, potentially reducing its ability to fund Bitcoin purchases.
While the index removal does not force Bitcoin sales or guarantee reduced Bitcoin purchases, it could weaken one of the largest corporate sources of demand in the Bitcoin market.
