TLDR
- Strategy bought 8,178 Bitcoins worth $835.6 million during the week ending November 17, expanding holdings to 649,870 tokens
- Bitcoin fell to $83,669 on November 21, representing a 32% decline from its October high of $126,272
- MSCI is reviewing rules that could exclude companies holding over 50% of assets in cryptocurrencies from its indices
- Potential removal could trigger $2.8 billion to $8.8 billion in outflows from index-tracking funds
- Strategy stock dropped 3% on Friday as investors weighed the dual pressures of falling crypto prices and index exclusion risks
Strategy added another chunk of Bitcoin to its massive holdings last week. The company purchased 8,178 tokens for $835.6 million in the seven days before November 17.
MicroStrategy Incorporated, MSTR
Chairman Michael Saylor disclosed the transactions in the company’s regular weekly filing. Strategy now controls 649,870 Bitcoins purchased for a combined $48.37 billion. Those holdings were worth $54.37 billion as of November 21.
The purchases came as Bitcoin prices tumbled hard. The cryptocurrency hit $83,669 on November 21, down 3.1% in just 24 hours. That represents a 32% plunge from the October peak of $126,272.
Bitcoin dropped below $86,010 on November 20. The selling reflects broader concerns about overheated artificial intelligence valuations driving investors away from risky assets.
The crypto surge past $100,000 in December 2024 feels like ancient history now. Those gains came on hopes for crypto-friendly regulations. On November 4, Bitcoin fell below $100,000 for the first time since May.
MSCI Review Creates New Problems
Strategy faces a different kind of pressure beyond Bitcoin’s price volatility. MSCI is consulting on new rules for its global investable market indexes.
The index provider wants to know if companies holding 50% or more of their assets in digital currencies should stay in its benchmarks. Strategy fits that description perfectly.
JPMorgan analysts crunched the numbers on potential fallout. They estimate Strategy could see between $2.8 billion and $8.8 billion flow out if MSCI follows through. The money would exit ETFs and mutual funds that track MSCI indices.
Strategy currently sits in the Nasdaq 100, MSCI USA, and MSCI World indexes. Getting kicked out wouldn’t force active managers to sell. But it would create negative momentum for the stock.
Capital Markets Access at Stake
The real worry is what index removal means for future fundraising. Strategy has funded its Bitcoin buying through regular equity and debt offerings.
Losing index status could make those capital raises harder and more expensive. The company relies on market access to keep buying Bitcoin.
Saylor isn’t backing down. He posted a single word on X: “Endure.” The chairman keeps pushing his “HODL” message, telling investors to hold their Bitcoin for the long haul.
Strategy made Bitcoin purchases every single day during the week before November 17. The buying pattern held even as prices crashed. The company last paused purchases between September 29 and October 5.
Strategy stock fell roughly 3% Friday morning as the MSCI news spread. The shares face pressure from two directions: falling Bitcoin prices and potential index removal.
The company’s weekly Bitcoin disclosures have become a key market signal. Investors watch to gauge Strategy’s confidence in crypto. So far, the buying hasn’t stopped.
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