| Katusa's Investment Insights | | The Index Bomb Set to Blow in 3 Weeks By Marin Katusa | | On January 15th, 2026, MSCI will decide whether to kick Saylor’s MicroStrategy out of its global equity indices.
If they do, every ETF and index fund tracking those benchmarks must sell.
No hesitation.
JPMorgan estimates $2.8 billion in forced liquidation from MSCI alone and up to $8.8 billion if other providers follow.
It's about a $100 billion category of companies that didn't exist five years ago.
One’s rewriting corporate finance and setting a trap for anyone who doesn't understand the mechanics.
I've spent my career in resource markets and what's happening with Digital Asset Treasuries deserves your attention.
Not because you need to trade them.
Because the playbook is coming to assets you already own.
The Zombie Resurrection
In September, Forward Industries, a 60-year-old medical device company running on fumes, announced it was pivoting to accumulate Solana. The stock ran over 500%.
Not because of earnings. Because investors found a new way to bet on crypto through their brokerage accounts. - This is the Digital Asset Treasury Company (DAT or DATC) model.
A public company raises capital through stock and bond offerings to buy cryptocurrency. A closed-end fund wearing a corporate costume.
Michael Saylor built the blueprint. His company now holds over 670,000 Bitcoin—just over 3% of all Bitcoin that will ever exist.
Today, over 200 DATs trade publicly with combined market cap exceeding $110 billion.
In the last 5 years, the growth in this sector has gone vertical. | | The Arbitrage Engine
Here's where it gets clever (and where the risk hides).
When investors want DAT exposure badly enough, they'll pay more than the underlying crypto is worth. If a company holds $10 of Bitcoin per share, buyers might pay $12.
That premium unlocks a powerful loop.
Issue new shares at inflated prices, buy more crypto, and each existing share now represents more Bitcoin. The stock rises. New buyers pay higher premiums. More shares issued.
Saylor executed this relentlessly. In 2024 alone, Strategy raised $4.8 billion through convertible notes, including a $3 billion offering at 0% interest and 55% premium to share price. | | Every issuance above book value was accretive to existing shareholders.
But the arbitrage only works while the premium holds.
But When the Leverage Turns…
In a downturn, DATs don't just fall with crypto. They fall faster.
The premium evaporates. Shares trade at a discount. The equity program becomes unusable, and nobody buys new shares below NAV.
Meanwhile, debt service continues. Convertible notes carry interest. Secured bonds have covenants.
A DAT trading at 1.3x NAV with meaningful debt? A 40% crypto correction doesn't just hurt, it breaks the model. The leverage that amplified gains now accelerates losses, and there's no mechanism to stop the bleeding. | | | Sponsored
This Wall Street legend called Netflix at $7.78 (up 4,200% since), Apple at $0.35 (up 20,000%), and Amazon at a split-adjust $2.41 (up 3,200%). Now he's turning his focus to a little-known AI company that just earned a near-perfect score in his new proprietary stock grading system. CLICK HERE to watch before the word gets out. |  | | The DAT class of 2024 and 2025 operated exclusively in favorable conditions.
The caution is that this model hasn't been stress-tested by a prolonged bear market.
Why Index Providers Are Drawing Lines
MSCI's review asks a simple question: Is Strategy an operating business or a commodity holding vehicle? | | Index providers exist to give investors diversified exposure to companies generating earnings, not single-asset investment funds disguised as corporations. - If MSCI decides DATs don't belong, the forced selling isn't optional.
Every passive dollar tracking those indices must rebalance.
Strategy alone could face $2.8 billion in redemptions from MSCI-linked funds and up to $8.8 billion if S&P, FTSE, and Russell follow.
That pressure undermines the company's ability to raise capital at premium valuations, threatening the entire treasury strategy.
Here's What I Keep Thinking About
Physical commodity trusts already exist. Sprott runs them for uranium, silver, and gold. They hold metal, trade publicly, and issue new units when premiums allow. The basic mechanics work.
But Sprott trusts can't use leverage. They're unleveraged, passive vehicles and closer to ETFs than to what Saylor built.
Nobody has applied the full DAT playbook to physical commodities yet. - Imagine an operating company, not a trust that issues convertible debt to stockpile uranium.
- Secured notes backed by U3O8 in licensed storage.
- An ATM equity program that grows pounds-per-share when premiums hold.
The same leveraged flywheel Strategy used to accumulate 3% of all Bitcoin.
The mechanics work identically. Premium to NAV enables accretive issuance. Leverage amplifies returns.
Shareholders get geared exposure without futures contracts or mining risk.
We haven't seen a leveraged Physical Asset Treasury, yet.
The financial engineering and investor appetite both exist. And in a world where 18 companies compete to be the Solana DAT, someone will connect these dots.
When they do, resource investors need to understand the playbook. The upside. The leverage trap. The index eligibility questions. - Watch the MSCI decision on January 15th. It will shape how capital markets treat asset-backed corporate structures for years.
And pay attention when any mining company starts talking about "treasury strategy" in their investor presentations.
Forward Industries was a 60-year-old zombie that reinvented itself overnight.
The next Physical Asset Treasury won't be.
Marin Katusa | | P.S. Over the next year, Katusa Research will be taking a closer look at the treasury companies, digital and physical that are doing this right.
Not the zombies chasing headlines. The operators building real infrastructure with real capital markets expertise.
If you're running a treasury strategy and believe sophisticated resource investors should understand what you're building…
We want to hear from you – email subscribers@katusaresearch.com.
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