Bitcoin News Today: Saylor's Bitcoin-Backed Model Faces Index Exclusion and Sector Sell-Off Pressures

Michael Saylor, the executive chairman of Strategy Inc. (MSTR), has doubled down on his Bitcoin-centric strategy despite a 41% plunge in the company's stock year-to-date, dismissing volatility as "Satoshi's gift" and asserting the firm can endure an 80% drawdown. In a November 14 interview with CNBC, Saylor argued that Strategy's Bitcoin treasury model-bolstered by minimal leverage of 1.15 times and debt extending 4.5 years-positions it to outperform even high-flying S&P 500 stocks like Nvidia according to analysis. The company, which holds 649,870 Bitcoin valued at $56 billion, continues to accumulate the asset, recently adding 8,178 Bitcoin at $102,171 per coin according to reports.

The bullish stance contrasts with growing concerns over Strategy's potential exclusion from major equity indices such as the MSCI USA and Nasdaq 100. MSCI proposed in October to exclude companies where digital assets exceed 50% of total assets, a rule that would directly impact Strategy, whose Bitcoin holdings account for over 90% of its balance sheet. JPMorgan analysts estimate such a move could trigger $2.8 billion in passive fund outflows from MSCI indices alone, with total losses reaching $8.8 billion if other index providers follow according to research. Saylor has pushed back, emphasizing that Strategy is an "operating company" with a $500 million software business and a $7.7 billion Bitcoin-backed digital credit program. He criticized the classification debate as a mischaracterization of his firm's hybrid model, which issues Bitcoin-backed securities like Stretch ($STRC) and leverages structured finance to generate yields.

The index uncertainty has exacerbated a broader selloff in the Bitcoin treasury sector. Coinbase Research describes the space as entering a "player-versus-player" phase, with 26 of 168 firms now trading below their crypto reserves according to analysis. Metaplanet, another major player, launched a $500 million credit facility for share buybacks in October after its stock fell below its Bitcoin holdings, signaling deteriorating valuations across the sector. Meanwhile, Strategy's stock has declined over 60% from its November 2024 peak, though it remains up 1,300% since initiating Bitcoin purchases in 2020 according to market data.

Saylor remains undeterred, envisioning a $1 trillion Bitcoin balance sheet to fuel a "digital monetary institution" offering Bitcoin-backed credit, savings products, and insurance. However, analysts warn that prolonged Bitcoin weakness-its price has dropped from a $126,000 peak in October to $80,700- threatens Strategy's ability to raise capital. The company's market-to-NAV ratio has collapsed from 2.5x to 1.1x, complicating new equity raises according to financial analysis. If Bitcoin continues to underperform, Saylor's "71 years of dividend coverage" claim may face scrutiny as liquidity pressures mount.