Bitcoin's Biggest Buyer Could Get Kicked Out Of Major Stock Indexes

Scott Melker (0:00)

Bitcoin's biggest buyer, Strategy, could get kicked out of major stock indexes, that being MSCI, which to my knowledge is one single index. But many people thinking that it could lead to a precedent of removal of Bitcoin and crypto treasury companies, digital asset treasury companies, from major indexes. We will talk about that briefly today, but I'm sure we have much more interesting topics to discuss with Sandy Call from Franklin Templeton. Let's go.

What is up everybody? Welcome to the show. Happy Friday. I hope that you've all had a wonderful week. As you know, I was off yesterday. I was at the full throttle event with Arch Public here in Tampa, which was amazing. I had conversations which I will release with Gary and Grant Cardone, Charlie Schramm, my friend Rob Baldwin from Robin Hood. It was a great event. I made the clear mistake of publishing an interview with Hunter Biden instead of doing a live show, which 12 of you watched and about 10 of you hated, apparently. So I'm very glad that I did that. But I thought it was going to be interesting. Clearly, nobody wants to hear about Hunter Biden right now. But who they do want to hear from, Sandy Call. Good morning, Sandy. How are you? Wow.

Sandy Call (1:26)

I never thought I'd be in the same sentence as Hunter Biden.

Scott Melker (1:29)

Sorry. You know, I had immediate regret as it was coming out. But you know, it just sort of happens.

Sandy Call (1:37)

Great to see you. Thank you for having me back on.

Scott Melker (1:40)

Good to see you as well. Last time was in person, which was really, really fun. That was out east in the Hamptons. Well, I guess not the Hamptons, the North Forks.

Sandy Call (1:48)

North Fork.

Scott Melker (1:49)

North Fork. You know, we Floridians, we get our New York geography wrong. But I live there long enough that I should know. Okay, so let's first of all, I just want to start with this first story that we have in the headline, and then I want to dig into everything, tokenization, Franklin Templeton. This seems to be the one everyone's talking about. MSCI finalizes index rules that put strategy, crypto treasury firms at risk of exclusion. Strategies, Michael Saylor spoke out against MSCI earlier this year calling it discriminatory against digital asset treasuries. Basically, the rule that they're proposing, and people are saying is discriminatory, is that you have to have an operating business with cash flow to be included in one of these indexes and simply holding an asset and financially engineering around it does not qualify as the kind of operating business that they would put into the index. I mean, I guess I can kind of see it.

I guess the bigger question is, is this a major risk to strategy? I would say an absolute no personally.

I think they're saying that it would be about a $2.8 billion outflow, and that's not even a day of trading on strategy stock.

Sandy Call (2:52)

I think that there is the broad Main Street acceptance of a digital treasury company, or the actual operation and interest in a digital treasury company. And I think Saylor has wanted both.

Maybe this takes away some of the sheen of this being a major mainstream offering, which is something I think he's always tried to include as part of their pitch. But I don't think, to your point, I don't think it's going to stop strategy. I don't think it's going to have people who are interested in strategy as an exposure, really looking to exit because they're not in the MSCI. So I think it is more about having a sheen of acceptance for the average investor, not those who are more interested in crypto and understand the crypto ecosystem.

Scott Melker (3:44)

Yeah. I agree with that entirely. And I think that whether they're included or not included in the index will be one of these headlines that's forgotten a week later.

Sandy Call (3:53)

Yeah.

Scott Melker (3:54)

I would say, how many people who are watching this knew that they were in the MSCI index before I told you that they might be too listed from the MSCI index?

So as I very rarely do, I decided to actually do five seconds of research before the show, and I just did a quick Google search, Franklin Templeton Crypto, easy, every day. The amount of news that you guys have is absolutely astounding. You've had Benji since 2021?

Sandy Call (4:27)

Yeah.

Scott Melker (4:27)

So obviously, you're way ahead of this trend. You were the first and now everything that you predicted is happening. So maybe just broad strokes, what are you focused on right now, and then we can double-click on some of those items?