Crypto-linked shares weaken after MSCI rule change and Cipher Digital financing
On October 16, Strategy shares fell 4% to $145.50 after MSCI changed eligibility tests that could affect the company at its November review. Cipher Digital declined 3% to $9.75 after pricing convertible financing for its Barber Lake data center, while Riot Platforms dropped 4% to $14.94. The financing carries no cash interest but could increase the share count if converted.
Why it matters
Strategy may face index-related selling if MSCI excludes it, while the new Cipher Digital financing supports development but creates potential dilution upon conversion. MSCI's rules state that an existing index constituent is removed only after failing the screen in two consecutive annual filing periods.
Key facts
- 1MSCI's revised eligibility tests for non-operating companies will apply at its November index review, where Strategy is considered potentially ineligible. 247wallst.com
- 2Strategy reported 846,000 bitcoin and $6.7 billion in convertible debt as of Q2. 247wallst.com
- 3Cipher Digital's financing is intended for its Barber Lake data center and other development, with settlement scheduled for Friday. 247wallst.com
- 4Cipher Digital's Odessa, Texas mining site has 207 megawatt of capacity, while its Black Pearl, Barber Lake and Stingray campuses represent 700 MW of signed gross capacity. 247wallst.com
- 5Cipher Digital's debt financing for its Stingray facility totaled $810 million and carried a 6% coupon. 247wallst.com
Summary written by AlphAI AI Desk from 2 of 2 sources. Not investment advice. Figures are as stated by the linked sources.