“Non-operating companies,” per MSCI’s October 15 confirmation of its August proposal, will be ineligible for its Global Investable Market Indexes. The proposal passed with minor modifications and did not name any companies. All eyes now turn to November 11, when any firm exclusions will be folded into the November 2026 Index Review. The new rules confirmed by MSCI stretch its benchmark exclusion criteria to cover corporate issuers that behave like the investment funds, business development companies and other passive vehicles it already bars.

MSCI proposes new test to screen Strategy and other heavy asset firms

MSCI proposed a two-stage test to screen whether firms qualify to continue to be included in its index or not. The first test checks whether a company counts as a real business based on the amount of operating assets it holds.
Issuers that fail the core test face a second test that scores companies across five financial ratios: operating asset intensity, expense intensity, cash flow, fair value intensity and capital dependence.

Firms need to pass on at least four of the five financial ratios to retain their eligibility card. Firms already in the index have a buffer, only facing exclusion after failing the index’s screen in both of its most recent annual filings. Companies that are not yet in the index will be ineligible for inclusion if they have failed in either of their filings over the previous two years. The MSCI simulation ran on May 2026 data put publicly traded firms with crypto reserves, Strategy, Metaplanet and Sharplink, on alert after they were flagged alongside other asset holding firms for deletion or watchlist designation.

Yellow Cake, a UK uranium holder, was also recommended for deletion in the simulation. Strategy could see about $2.8 billion flow out of its stock if MSCI decides in November to drop the firm from its index, according to JPMorgan analysts. That potential outflow will result from a forced sell-off by funds tracking MSCI benchmarks. The company has already refuted the scale of an unfavorable MSCI decision, arguing that MSCI GIMI-linked funds hold only about 3.1% of its shares.

Strategy’s MSTR stock closed Thursday trading at $151.29, while Metaplanet’s stock traded at 277 yen (about $1.75). Strategy Executive Chairman Michael Saylor and CEO Phong Le signed a September letter calling the proposal “discriminatory, arbitrary, and misguided” and a “pretext” for targeting digital asset treasuries. The letter warned that it “would profoundly harm MSCI’s reputation as a reliable and neutral index provider.”

Saylor frames Strategy as an operating business. Originally MicroStrategy, it sells business intelligence software to clients including Coca-Cola and Porsche, and treats its Bitcoin treasury as a separate operating segment rather than an investment holding. The Bitcoin Policy Institute escalated the dispute up to the Congress level in a September 30 paper by Conner Brown. BPI called on Congress to scrutinize MSCI’s power, noting that 54% of long-term US fund assets track benchmarks from just three providers and that roughly $21 trillion is benchmarked to MSCI alone, as Cryptopolitan reported.

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The company’s 8-K filing said the first daily payment would fall on November 2. STRF, STRK, and STRD would move later. Their first daily payment would be on January 4, 2027, to holders of record as of January 1, 2, and 3, and each subsequent payment would be on the next business day following its record date. Strategy’s board signed off on September 24. The filing says the rates, total regular dividends, and the company’s overall payment obligations remain unchanged.

Strategy to unveil new plans for STRC holders

The preliminary proxy lists all four preferreds under “Not Entitled to Vote.” The proposal passes only with backing from a majority of the voting power of all outstanding common stock. STRC’s last schedule change was a little different. In May, Strategy enabled holders of STRC as of April 17 to vote on changing over to twice-monthly payments, reported Cryptopolitan.

The meeting on October 28 will be virtual. But a yes vote does nothing until Strategy files amended certificates of designations with Delaware’s Secretary of State. “The proposed changes aim to support price stability, liquidity, and demand,” Strategy co-founder and executive chairman Michael Saylor said on X. In a separate statement, Strategy pitched steadier preferreds as easier to sell, which would help fund more Bitcoin buying.

STRC’s variable rate is meant to keep it close to $100 par, which it lost badly in June when it dived below $75. It traded at $98.40 on Friday afternoon, up 0.09% on the day. Strategy has defended par since June with a preferred buyback plan that started at $1 billion and doubled to $2 billion this month. Cryptopolitan reported the buybacks included 1,810,885 STRC shares for $176.3 million in early September.

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Strategy bought 4,603 Bitcoin between August 24 and 30 for an average of $80,318 per Bitcoin, as per the SEC filing. This brings Strategy’s total holdings to 845,050 Bitcoin. Strategy has already spent $63.73 billion in accumulating this stake in Bitcoin. Its average price per Bitcoin is $75,412. Saylor confirmed the figures in an X post on August 31, saying that the company owns “845,050 bitcoin” and $6.71 billion in what they call “USD Assets,” which consist of USD Reserve and USD Cash accounts. The net leverage of the company is 0.0%.

Strategy BTC purchase to instill investor confidence

The purchase was reportedly done without spending any extra money. As part of its ATM program, Strategy raised a net of $602.8 million through selling 4,531,421 shares of MSTR stock in one week. $369.7 million was spent to purchase Bitcoin, $151.8 million was spent to purchase STRC preferred stock, $50.7 million was spent on dividend payments on preferred stock, while the remaining $30 million was spent on increasing the company’s USD Cash reserves.

The issuing of stocks to acquire Bitcoin has always been the way of funding the company’s operations. The company decided to restart the process only when the prices of its stocks recovered enough to be a more profitable way of acquiring capital compared to borrowing. That approach has turned out to be quite costly. From May to August, the company sold 6,948 BTC for around $432.5 million ($62,250 each). The repurchase at the price of $80,318 per coin implies that the company overpaid by almost 29%.

The final result is that Strategy is down 2,345 BTC, but it managed to get around $63 million in the process. The summer sales happened for certain reasons. When the share price of STRC fell below its par value of $100, a funding source of the company was closed off. In order to continue with the process, the company has decided to launch the Digital Credit Capital Framework, under which it plans to sell Bitcoin up to $1.25 billion to pay dividends and repurchase its own preferred stock. At press time, Bitcoin costs $77,849.

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Michael Saylor, the company’s executive chairman, confirmed the news, writing on X that Strategy has now achieved 2.1 years of coverage for dividend and interest payments. As of the filing, Strategy has a total of $3.75 billion in its USD Reserve. Saylor announced the update a day early, as Cryptopolitan reported. On Sunday, he posted the same tracker chart with the comment “We’re gonna need another color”, a behavior that had in the past consistently been followed by a disclosure on Monday regarding a coin purchase.

Strategy continues to grow its USD reserve

The follow-up was a reserve building; Strategy failed to buy any Bitcoins during the week, which meant it was the fifth week in a row. The company holds a total of 843,775 BTC, worth $54 billion, sitting on paper losses of more than $8 billion. Long-time Bitcoin and Strategy Peter Schiff said that selling MSTR was a wrong move, arguing that Strategy should have sold BTC instead of the “discounted MSTR shares.”

“So, another week when you chose to destroy common shareholder value by selling discounted MSTR shares (thereby reducing Bitcoin per share) to raise cash and buy back STRC rather than sell Bitcoin,” Schiff posted. He argued that the common stock sell-offs leave investors with no legitimate reason to own MSTR.

Strategy will report its Q2 earnings results on Thursday, July 30th. The company’s earnings are expected to increase by 6.40%, reaching $121.88 million. MSTR currently trades at $97.46, up 6.44% in the day, following the news. The consensus price target for MSTR is around the $360 price mark, which implies an upside potential of over 290%.

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The update, disclosed in an SEC 8-K filed Sunday, marks the company’s first structured response to criticism over its balance sheet.

Digital Credit Framework Sets Reserve Rules

The Michael Saylor-led firm introduced the plan as its Digital Credit Capital Framework, a five-part approach covering liquidity, dividends, repurchases, and Bitcoin monetization. The filing said Strategy’s board approved a USD reserve policy tied to preferred dividends and debt interest.

Under the policy, Strategy’s $2.55 billion cash reserve can be used only for preferred dividends and debt interest payments. Management is expected to maintain 12 months of coverage. Based on annual obligations of about $1.76 billion, the reserve provides around 17.4 months of coverage.

The company disclosed a $14 billion setback on its 847,363 BTC holdings, with Bitcoin trading near $60,500. The framework follows criticism from Peter Schiff, CryptoQuant analysts, and Ripple CEO Brad Garlinghouse.

Buybacks And Bitcoin Monetization Enter Plan

Strategy’s board authorized two repurchase programs totaling $2 billion. One program covers up to $1 billion of STRC, STRF, STRD, and STRK preferred securities. The other allows up to $1 billion in repurchases of Strategy’s Class A common stock, MSTR.

The authorization does not require Strategy to buy back securities. The company may suspend or end either program without notice.

The Bitcoin monetization program gives management discretion to sell Bitcoin when appropriate. Proceeds, if sales occur, may support the cash reserve, dividends, or repurchase activity.

The board approved $1.25 billion in initial Bitcoin monetization capacity. If fully used, that would increase liquidity coverage to about $3.8 billion, or roughly 26 months of obligations before repurchases, taxes, or transaction costs, according to Strategy’s press release. Strategy previously sold 32 BTC for $2.5 million to help fund dividend repayments.

STRC Dividend Rises As Shares React

Strategy raised the annual dividend on STRC preferred stock to 12%, effective July 1. Before the increase, STRC had gone through seven rate hikes, moving from 9% to 11.5%. STRC closed Friday near $74.57, a discount of about 25%.

“Digital Credit requires liquidity, discipline, and active capital management,” Saylor said. He added that the framework is “designed to strengthen credit quality and enable the Company to reduce expected preferred stock dividend payments when accretive.”

CEO Phong Le said Strategy is shifting from a capital issuance model to active capital structure management through issuance and repurchases. After the announcement, MSTR rose 6% in pre-market trading, STRC gained about 9%, and Bitcoin moved modestly higher near $60,500.

Investors will closely track quarterly disclosures for Bitcoin sales, reserve changes, and repurchase activity.

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“Bitcoin needs an easing cycle,” Novogratz has repeatedly emphasized in recent commentary. According to Novogratz, the Federal Reserve’s current stance has kept liquidity constrained, limiting Bitcoin’s ability to break through key psychological price levels. Still, he argues that if the U.S. Federal Reserve were to cut interest rates, the market might come back to see a more balanced picture of the cryptocurrency. Concerns about Bitcoin momentum were also raised by Anthony Scaramucci on the All Things Markets podcast, where he pointed to weakening indicators such as BTC’s Relative Strength Index (RSI), a widely watched measure of market momentum that has recently fallen to unusually low levels.

Galaxy Digital CEO urges BTC traders to be patient

Google searches for Bitcoin have declined in recent years, and market interest is at an all-time low. And people are increasingly concentrated in Bitcoin ownership. Scaramucci said that currently, 79% of Bitcoin’s circulating supply is owned by people who haven’t moved their coins in a long time. That’s a question of whether these trends were a sign of a market bottom or of Bitcoin becoming a “dead asset.” Novogratz rejected that view and urged investors to be patient. “You’ve got to give Bitcoin the benefit of the doubt,” the Galaxy Digital CEO said.

He also added that investors should wait until at least next year before deciding on the asset’s long-term future. The reason for Bitcoin’s recent weakness is that the market expects U.S. interest rates to stay high for a long time, Novogratz said. Investors have been expecting a more aggressive policy stance from the Federal Reserve as it transitions to the new Fed chairmanship. The markets have come to expect higher borrowing costs. And Novogratz said this has also weighed on Bitcoin and other assets, such as gold.

On Bitcoin, he thinks the situation would change if the US economy were weak enough to push the Fed to reverse course and cut interest rates. Low rates generally make risk assets attractive, as borrowing is cheaper and liquidity rises in the financial markets. Many investors may not realize that future rate cuts are likely, Novogratz said. The issue of debt and economic conditions can eventually push the Fed into a more accommodative policy, he said. Bitcoin may attract investors who are still seeking protection against currency debasement and inflation, restoring some of the momentum it has lost in recent months.

Despite his long-term optimism, the Galaxy Digital CEO admitted that the Bitcoin market currently lacks enthusiasm. He said there is little fresh demand entering the market and described the current environment as one with “no energy” and “no new buyers.” This lack of new capital has contributed to Bitcoin’s inability to sustain upward momentum. Novogratz also referenced challenges facing some Bitcoin-focused investment strategies.

The Galaxy Digital CEO pointed to concerns surrounding financing models associated with Strategy Executive Chairman Michael Saylor, whose company has become known for aggressively accumulating Bitcoin through debt and capital-raising programs. Even so, Novogratz remains confident that the broader Bitcoin story is not over. He believes investors should focus less on current market sentiment and more on the factors that could emerge over the next several months. According to him, the key catalyst remains a potential shift in Federal Reserve policy.

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The spot on Twenty One Capital’s (XXI) audit committee became empty after Tether purchased all 89.1 million shares SoftBank held in XXI for approximately $711 million on May 20. The deal gave Tether uncontested control as the majority shareholder of the Bitcoin treasury company, which holds more than 43,500 BTC. Once the deal closed, SoftBank’s representatives had to leave the board, including the one who served on the audit committee.

Tether fills vacant slot on Twenty One Capital’s board

Tether has now filled that spot with an independent director that it says meets the tough independence rules. The rules in question come from the Securities Exchange Act (Rule 10A-3) and the NYSE Listed Company Manual (Section 303A.02). These rules are designed to make sure audit committee members can oversee the company fairly without conflicts of interest.

Paolo Ardoino, Tether’s CEO, said in the announcement that a great deal of rigor was put into finding the best candidate to deliver thorough and independent oversight. “The strength of the oversight needs to match the strength of the balance sheet,” Ardoino said, but Tether did not reveal the name of the new director in its announcement. An audit committee is a group of board members who oversee a company’s financial reporting.

The NYSE requires listed firms to have at least three independent members on this committee. XXI is placed second among publicly traded corporate Bitcoin holders, trailing only Strategy (formerly MicroStrategy). Independent board oversight is especially important now that Tether has consolidated its position. The stablecoin issuer already held voting control through XXI’s Class B shares and maintained approval authority over Bitcoin sales, mergers exceeding $1 million, and executive appointments.

Proposal to merge with XXI in the works

Tether has also proposed combining XXI with Jack Mallers’ Bitcoin payments company, Strike, and mining firm Elektron Energy. The three-way merger, first proposed in late April 2026, would create a vertically integrated Bitcoin business that includes treasury accumulation, payments, lending, and mining operations. Elektron manages about 50 exahashes per second (EH/s) of mining power. That is roughly 5% of the entire Bitcoin network. The platform has already mined more than 5,500 Bitcoins.

Twenty One Capital launched in December 2025 through a SPAC merger with Cantor Equity Partners and trades on the NYSE under the ticker XXI. The merger has several hurdles surrounding its governance. For example, Jack Mallers currently serves as CEO of both Twenty One Capital (XXI) and Strike. The dual role is a conflict of interest that will require special review and a vote by minority shareholders.

Raphael Zagury, the CEO of Elektron Energy, is a defendant in active lawsuits filed by Swan Bitcoin in California and the UK. Swan alleges that Zagury and other former executives conspired with Tether in 2024 to take over a mining joint venture. Tether has announced its intention to vote in favor of the mergers, but no final terms, closing timelines, or formal merger agreements have been signed or publicly released.

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Saylor stated the ‘BitVac’, short for BTC vacuum, will be changing away from the usual weekly purchases. The company has held up to $2.5B in cash reserves. The bonds in question refer to a repurchase of older Strategy debt, namely $1.5B in debt due in 2029. This time, Strategy did not outline the financing source of its repurchase operations. The BTC purchase delay may also be due to the US market holiday. The biggest investor fear is that Strategy may have sold some of its BTC to finance debt repurchases, making its playbook unstable.

Strategy pauses BTC purchase to initiate new strategy

The company will still be liable to pay STRC dividends of 11.5%, soon to become bi-weekly. Additional dividends are owed for older issuance of preferred shares STRD and STRK, which have not been used for months as a source of BTC purchases. The market anticipated this week’s pause in BTC purchases, as there was no data on STRC trading in the suitable price range for additional sales.

After a week of $2.2M in total new sales, STRC buyers also hit a pause, on a mix of skepticism and the longer waiting period until the ex-dividend date in June. In the past two months, Strategy fell into a pattern of large purchases ahead of the dividend cut-off date, followed by smaller weekly additions financed by MSTR ATM selling. This time, Strategy did not use its common stock issuance facility, instead focusing on its cash-like reserves.

MSTR fell to $159.89, down from its recent hike above $170. The BTC purchasing pause coincided with a generally lowered demand for MSTR, as the common stock does not act as a multiplier for BTC gains. Strategy changed its playbook after buying over 4% of the total BTC supply. For now, the company remains a strong holder, though it does not try to add BTC at any rate.

The biggest fear around Strategy is that its demand structure reflects the dwindling crypto sentiment. The market is no longer in ‘up only’ mode, even for BTC. As a result, only STRC is attractive for its high monthly payouts. However, Strategy carries a growing dividend burden, sparking fears the company may not be sustainable, especially during a prolonged crypto bear market. STRC will have to show stronger demand, as predicted during the week ahead of June 15.

Until then, skeptics have noted that Strategy may gain only up to 5% in yield on more conservative bonds, while owing 11.5% for STRC. After the week of no purchases, BTC traded at $77,216, sitting just above Strategy’s average price. Selling or stagnant demand may further undermine the trust in Strategy’s playbook, without other factors sparking a BTC bull market.

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Arthur Hayes also mentioned that Saylor doesn’t concern himself with ordinary investors holding Bitcoin and hoping a public company will keep bidding forever. He added that Saylor is there to protect Strategy, its stockholders, and the products built around its balance sheet. “We’re going to see these little pops in Bitcoin, not huge. But every time you see that STRC is about to trade above par and go above 100, as you can literally front run Saylor transparently buying a couple billion dollars in two or three days. Why wouldn’t you want that trade, you know?” he said.

Arthur Hayes issues warning to Bitcoiners relying on Strategy’s BTC purchase

According to Hayes, the tracker indicated that Saylor could have made 2,000 BTC purchases once STRC broke above parity. He wants to anticipate the transaction because it is observable. As simple as it sounds, there are traders who would attempt to front-run a buying spree once an order from such a major player becomes apparent. On the other hand, Hayes confessed that he hasn’t researched all aspects of corporate finance in STRC.

However, he noted that what makes Strategy different is the fact that only a few organizations are capable of developing financial instruments based on Bitcoin. Strategy has the resources to leverage its massive Bitcoin balance sheet, Wall Street desks, and capital market structure. “I mean I don’t think Strategy is going out of business anytime soon. Obviously from what I understand he doesn’t have to pay a dividend in STRC. You’re sort of trusting that he’s going to. What happens when you trust in crypto. It doesn’t end up very well. Not that Saylor’s doing anything bad,” said Hayes.

Strategy has also been working on its debt side, moving to repurchase about $1.50 billion of convertible notes while still adding Bitcoin through stock-linked funding, as Cryptopolitan previously reported. That puts Saylor in the middle of more than one job at once: buy Bitcoin, manage leverage, keep capital coming in, and deal with investors who expect returns. Michael has also signaled that Strategy’s old “never sell” posture may not be as simple as people thought.

He indicated that limited Bitcoin sales could be used to improve BTC-per-share and help fund dividends. That is a big deal for Bitcoin investors who treated Strategy’s holdings like a vault that never opens. Scott told Arthur: “I talked to him [Saylor] Wednesday morning, just by total coincidence, like I had the first interview lined up with him right after he said he’d sell some Bitcoin. I was like, ‘Oh, this is going to be fire,’ and you know, like he didn’t say it explicitly, but yeah, his shareholders and anyone who’s buying STRC and the SEC need to hear that Bitcoin is not an impaired asset when it comes to protecting dividends and STRC.”

Scott also said Saylor may have to say he could sell some Bitcoin if retail investors get hurt, because a public company executive cannot just talk like a crypto anon on X. He joked that saying the wrong thing could bring legal trouble. Brian Armstrong, CEO of Coinbase Global Inc. (COIN), came up in the same context. “Like, you know, Brian Armstrong also can’t just go out there and say wild stuff about crypto prices. He has to actually protect his shareholders,” said Hayes.

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According to the filing, Strategy bought these at an average of $80,340 per Bitcoin in this current bunch. After the latest buy, the company’s full Bitcoin stack cost about $61.9 billion, with an average purchase price of $75,540 per BTC, including fees and expenses. With Bitcoin recently above $81,000, the stash was worth about $66.5 billion, putting the position in profit on paper. Strategy now owns more than 3.9% of Bitcoin’s 21 million supply cap, and will use stocks, preference shares, and debt-tied instruments to buy into 2027.

Strategy pushes its BTC stash towards 819,000

The cash came mainly from at-the-market sales of company securities, including Strategy’s Class A common stock, MSTR, and its perpetual Stretch preferred stock, STRC. Strategy has at-the-market programs tied to four perpetual preferred stocks: STRK (which has a $21 billion program), STRC (which has $4.2 billion), STRF (which has $2.1 billion), and STRD (which has $4.2 billion).

The firm has also increased its room to raise money, recently issuing another up to $21B MSTR share offering in addition to its STRC and STRK security offerings. STRC has now become a major component of its Bitcoin purchase mechanism. Strategy has requested to move dividends on STRC to a bi-weekly rather than monthly basis, noting that the move “could result in reduced reinvestment lag, greater liquidity, efficiency, and increased price stability.”

Before the latest Bitcoin purchase was made public, Strategy co-founder and executive chairman Michael Saylor posted his regular Bitcoin tracker update on X. He wrote, “Back to work,” after the company skipped buying the week before its first-quarter earnings release. Cryptopolitan had reported about a week ago that Strategy saw a $12.7 billion net loss for the first quarter of 2026, with most of that coming from a $14.5 billion unrealized markdown tied to the value of its Bitcoin holdings.

During the first-quarter earnings call, Michael said Strategy could sell Bitcoin later if it needs cash for STRC dividends or convertible debt payments. “We’ll probably sell some Bitcoin to fund the dividend, just to inoculate the market, just to send the message that we did it,” he said. Over the weekend, Michael said any sale would likely be smaller than later purchases. “In these periods, even if we were to sell one Bitcoin, we’d be buying 10 to 20 more Bitcoin,” he said.

The Bitcoin treasury trade is no longer just a Strategy thing. Bitcoin Treasuries data shows 196 public companies now have some type of Bitcoin buying plan. Still, many of those stocks have dropped hard from their summer 2025 highs as market cap-to-net asset value ratios came down. Strategy’s MSTR is still about 59% below those highs, with an mNAV ratio of 1.04. The stock rose 9.8% last week and closed Friday at $187.

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