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MSCI Blocks Share Count Increases in Index Constituents, Affecting Bitcoin-Linked ETFs

MSCI will retain current index members but suspend share adjustments, disrupting Bitcoin treasury firms dependent on new equity issues tied to passive fund inflows.

BTC

Summary

On January 8, MSCI confirmed it will keep existing index constituents, including Bitcoin treasury firm Strategy, but imposed a technical freeze on share count adjustments and delayed any inclusion or size changes. This severs the link between new share issuance and passive index fund purchases, affecting companies relying on at-the-market issuance to acquire Bitcoin. The change could impact Strategy’s Bitcoin accumulation model and similar approaches by other firms.

Terms & Concepts
  • ATM Share Issuance: A process where companies sell new shares directly into the market at prevailing prices to raise capital quickly.
  • Passive Fund: An investment fund that tracks a market index and automatically buys or sells securities to match the index composition.
  • Exchange-Traded Fund (ETF): A publicly traded investment fund that holds a basket of assets and aims to track the performance of a specific index or asset class.