Saylor Urges MSCI to Drop 'Discriminatory' Rule That Would Delete Strategy

In brief

• Michael Saylor and CEO Phong Le asked MSCI on Monday to withdraw a proposed screen that would remove Strategy from its Global Investable Market Indexes.
• The screen flags issuers on five financial ratios, and tripping four of them makes a company ineligible for inclusion.
• MSCI's consultation lists UK uranium holder Yellow Cake among the three companies facing deletion, alongside Strategy and Metaplanet.

Strategy founder Michael Saylor and CEO Phong Le have asked MSCI to withdraw a proposed eligibility test that would delete the Bitcoin treasury company from the index provider's global benchmarks, in a letter published Monday.

The proposal is "discriminatory, arbitrary, and misguided," the letter stated, arguing that it serves as a pretext for targeting digital asset treasuries and repackages the 50% crypto-holdings proposal MSCI declined to implement in January.

The consultation, opened in August, covers what MSCI terms "non-operating companies." Issuers whose operating assets fall below half of total assets face a five-flag screen measuring operating asset intensity, expenses, cash flow, fair-value swings and dependence on external financing. Tripping four flags renders a company ineligible, and existing constituents must fail in two consecutive annual reviews before deletion.