MSCI Considers Excluding Digital Asset Treasuries from Indexes Amid Governance and Liquidity Concerns
MSCI, a leading index provider with over $18 trillion in ETFs and institutional assets tracking its benchmarks, is considering excluding digital asset treasuries (DATs) from its indexes. This caution arises from concerns regarding DATs' compliance with investability, governance, liquidity, and transparency benchmarks.
The number of DATs expanded sharply from 4 in 2020 to 142 by October 2025, with many new launches occurring this year as corporate treasuries increasingly invested in crypto assets. Despite this growth, the DAT market has experienced a significant pullback, with total market capitalization falling from about $176 billion in July to roughly $99 billion by mid-November. Many DATs currently trade below their net asset values (NAVs).
Several DATs have been compelled to liquidate crypto holdings to fund buybacks. Examples include ETHZilla selling $40 million in tokens, FG Nexus selling 10,922 ETH, and Sequans selling 970 BTC. The structures of DATs vary considerably; some employ secured debt arrangements demanding higher collateral, while others such as MicroStrategy (Strategy) use unsecured convertible debt, affecting their risk profiles and flexibility.
MSCI's stance to exclude DATs is framed as a prudent and sensible risk management approach rather than a targeted critique of crypto integration. Exclusion would indicate perceived risks and governance shortfalls, underscoring concerns about liquidity and transparency for investors.
As the crypto ecosystem further integrates with traditional finance, these challenges and growing pains may foster stronger and more legitimate DATs, mitigating systemic risks over time. Although the overall DAT ecosystem shows mixed performance—with some key players like Strategy and BitMine able to capitalize on market dips and others struggling—the cautious approach by MSCI aligns with protecting investor interests amid current market conditions.
