Bitcoin’s Rollercoaster: A Turgenevian Take 🎢

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On a Wednesday, grey and unremarkable as so many days are, the shares of Strategy (MSTR) – a company, one might say, rather enthusiastically devoted to the acquisition of digital coinage – experienced a trifling ascent of six per cent. This occurred following an announcement from Morgan Stanley Capital International (MSCI), a body whose pronouncements hold, for reasons entirely beyond a simple man’s understanding, considerable sway over the markets. They would, it seemed, continue to tolerate the presence of these “digital asset treasury companies” – a phrase which itself sounds faintly ridiculous – within their indexes.

Strategy’s Precarious Position

There had been whispers, you see, anxieties amongst the investors – those ever-fidgety souls – that Strategy, led by the remarkably resolute Mr. Saylor, might be cast out from this influential grouping. Such a prospect sent a tremor through the crypto-sphere, and even caused a visible disturbance, a sort of collective shudder, in the price of Bitcoin itself on the tenth of October. One wondered if the gentlemen in question needed more pressing concerns than the fate of a handful of digital tokens, but who are we to judge? 🤔

MSCI, in a missive issued on the sixth of January – a date rather lacking in festive cheer – confirmed that they would not, for the time being, enact the proposal to banish these DATCOs from their indexes. Companies which persist in the rather peculiar practice of hoarding more than half their wealth in these ephemeral currencies may continue to do so, apparently without censure.

However, a change was implemented, a subtle shift in the rules, which promises to bring about complications, not to mention a degree of mild inconvenience.

The Pinch of Capital

The astute observers at Bull Theory – a name which suggests a certain bullishness, wouldn’t you agree? – have noted a curious detail. Formerly, when Strategy decided to issue more shares (a practice, one suspects, not entirely unrelated to acquiring further Bitcoin), MSCI would dutifully include these newly-minted shares in their index. Index funds, those vast and impersonal entities, are compelled to purchase a significant portion – roughly ten per cent – of these new shares. A rather convenient arrangement, wouldn’t you say? 🤑

Imagine, if you will, shares priced at three hundred each, and the issuance of twenty million such shares. The index funds would be obliged to spend six hundred million, a sum that could, with a little effort, be used to obtain more Bitcoin.

But no longer. Under the revised rules, MSCI will not increase the share count in its index. The index funds, therefore, have no obligation to purchase these new shares. A veritable calamity! Strategy is forced to seek willing buyers, individuals with pockets deep enough to support their ambitions, and may find itself acquiring less Bitcoin than before. A most lamentable state of affairs! 😩

Morgan Stanley’s Ambitions

Mr. Crypto Rover – a rather ominous moniker – has pointed out that this change in policy arrives at a rather curious moment. Given the close relationship between MSCI and Morgan Stanley, one cannot help but wonder at the motivations behind this adjustment.

It seems Morgan Stanley has, rather recently, filed for a spot Bitcoin and Solana exchange-traded fund (ETF). Thus, Strategy finds itself in direct competition with a banking institution of considerable size and influence. A David and Goliath scenario, perhaps, but one in which Goliath possesses considerably more capital.

Rover suggests that many investors have been drawn to Strategy as a simple, if somewhat roundabout, means of gaining exposure to Bitcoin. This has benefited both the company’s share price and its reputation as a prodigious accumulator of the digital asset. With this new directive, however, the challenge of acquiring more Bitcoin may prove significantly more arduous. A share dilution could, one fears, lead to a precipitous decline in the stock price, devoid of the previous, automatic demand.

Rover predicts that large investors, discerning souls that they are, may choose to redirect their funds to these new ETFs, particularly if Morgan Stanley’s offering proves popular. A perfectly reasonable expectation, wouldn’t you agree?

As of now, Strategy’s shares rest at one hundred and sixty-six, having experienced a minor recovery from a recent low of one hundred and fifty. A hint of hope, perhaps, in a world increasingly captivated by these digital illusions. But one should not rely on hope alone, my friends. One should always have a good, solid waistcoat and a healthy dose of skepticism.

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2026-01-08 08:14