Vivek Ramaswamy’s Strive Challenges MSCI’s Proposal on Bitcoin Treasury Index Classification
On October 10, MSCI proposed reclassifying public firms that hold significant bitcoin or digital assets as “funds” rather than operating companies. This change, if approved, could remove companies with over 50% digital asset holdings from its key indexes. Such a shift threatens firms categorized as digital asset treasuries, whose combined crypto holdings exceed $180 billion.
Strive Asset Management, co-founded by former U.S. presidential candidate Vivek Ramaswamy and currently holding $704 million in bitcoin, strongly opposes MSCI’s move. The firm submitted a seven-page letter urging MSCI to withdraw the proposal, arguing it risks violating the neutrality principle of passive investing. The letter states, “An index provider’s purpose is not to take a view, but to accurately reflect the equity universe.” Strive emphasizes MSCI already offers tools allowing investors to exclude bitcoin-heavy firms if desired.
MSCI’s proposal raises the question of whether companies holding and financially engineering bitcoin qualify as operating businesses. Michael Saylor’s Strategy, the largest bitcoin treasury, faced a 20% share drop after the announcement. Saylor argues that bitcoin-backed structured finance is a legitimate operating business. Strive echoes this view, highlighting growing business diversity among miners like MARA Holdings and Riot Platforms, which are expanding into AI infrastructure.
Strive officials warn that MSCI’s strict 50% threshold could cause index volatility. Bitcoin’s price swings might push companies in and out of eligibility each quarter, harming fund-tracking accuracy. Also, accounting differences between U.S. GAAP and international IFRS standards might cause inconsistent classifications based on geography. According to Strive’s chief investment officer Ben Werkman, “You’re going to penalize the U.S. markets … in favor of international markets with more favorable rules.”
Critics like NYU Stern’s Austin Campbell argue that digital asset treasuries lack core operating activity. MarketVector’s CEO Steven Schoenfeld supports MSCI’s efforts to standardize classification, equating these firms to investment trusts excluded globally to prevent double counting. MSCI plans to finalize its decision by mid-January, a ruling that could significantly impact public bitcoin treasury firms and associated financial products.
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