Bitcoin FinTech enters the Russell 2000 index while the risk strategy may lead to its exclusion from the MSCI index.

Financial services company Bitcoin Fold Holdings is included in the underlying Russell 2000 index of US small-cap stocks.

The announcement comes as MSCI is considering excluding cryptocurrency companies from its indexes, attracting significant attention from the industry.

Fuld Holdings announces its inclusion in the Russell 2000 Index

Fold Holdings (NASDAQ: FLD) announced officially Inclusion in the Russell 2000 Index on December 22. The company describes itself as the first publicly listed Bitcoin financial services company, with more than 1,500 BTC in its treasury. Their products include the Fold App, the Fold Bitcoin Gift Card, the Fold Debit Card, and the highly anticipated Bitcoin Fold Rewards Credit Card.

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Will Reeves, president and CEO, said: “The inclusion of Fuld in the Russell 2000 Index is a major milestone that confirms our position as a successful public company. We expect the inclusion in the index to broaden market awareness and increase our visibility among institutional and retail investors,” added Reeves. He also noted that the company is focused on disciplined execution, expanding distribution and creating sustainable value for shareholders.

Goldman Sachs analyst Ben Snyder on Monday expected the Russell 2000 to see upward momentum in early 2026. However, he expected annual returns of about 10%, slightly lagging the S&P 500’s forecast of 12%. The consensus estimate of 61% EPS growth for the Russell 2000 looks “overly optimistic,” the analyst said, adding that the high variance of returns in the index can create alpha-generating opportunities for active investors.

What is the Russell 2000 Index?

The Russell 2000 includes approximately 2,000 US small-cap stocks, representing approximately 5-7% of the total US common stock market capitalization. Unlike the S&P 500, which focuses on large-cap stocks, the Russell 2000 tracks smaller companies with higher growth potential and serves as a benchmark for mutual funds and ETFs that measure the performance of small-cap investments.

Crypto-related company before it joined the Russell 2000 before Fold Holdings. Bitcoin mining companies such as Marathon Digital Holdings (MARA), Riot Blockchain, Safer Mining and Bit Digital are already included in the index. In 2023, these companies are among the best performers in the Russell 2000 Index.

However, what distinguishes Fold Holdings from the rest of the existing components is that it provides consumer-oriented fintech services, not mining operations.

MSCI considers excluding crypto companies

MSCI’s ongoing discussions draw more attention to Fuld Holdings’ listing. In October, Suggested by a prominent global index provider Eliminate companies whose digital asset activities exceed 50% of total assets from their global indexes, under the pretext that these companies are more like investment funds than operating companies.

Strategy (formerly MicroStrategy) led by Michael Saylor is among the most notable companies at risk. According to an analysis by JP Morgan, Strategic could face $2.8 billion in outflows due to its mere exclusion from the MSCI index. Losses could reach $8.8 billion if other indicators follow the same approach. Saylor and Strategy CEO Fong Lee warned in a public letter that the exclusion would deprive these companies of about $15 trillion in passive investments, and cause a “freeze” in the industry.

MSCI’s consultation period ends on January 15, when the final decision will be announced. Analysts warned that MSCI’s decision could set a precedent for the broader index industry, as other stock index providers are likely to follow similar policies. The risks are high for digital asset treasury companies, as many finance token purchases by selling shares and rely on passive fund flows. MSCI’s initial list identified 38 companies with a total market capitalization of $46.7 billion that are at risk of being excluded.

The digital asset treasury sector has seen rapid growth, with a combined market capitalization exceeding $150 billion in September — more than triple the number a year ago, according to industry estimates.