JPX Market Innovation & Research (JPXI) is currently considering a new rule that would defer companies whose principal asset is cryptoassets from new inclusion in TOPIX and other periodically reviewed indices. While the underlying concern of how to treat an emerging category of issuer is understandable for any index provider, the specific proposal has raised significant questions regarding its alignment with TOPIX’s established methodology and principles. This proposed rule would directly impact Japanese issuers like Metaplanet, Remixpoint, and ANAP Holdings, whose business models are legitimate and regulated.

Several reasons suggest JPXI should reconsider this proposal before its potential implementation in February 2026. Firstly, the rule fundamentally departs from what TOPIX normally measures. TOPIX is designed as a broad, neutral, and investable benchmark of the Japanese equity market, employing objective tools such as liquidity screens, free-float-adjusted market capitalization criteria, and continuation buffers. A crypto-asset screen, however, assesses the composition of a company’s balance sheet rather than liquidity, turnover cost, or listing quality, introducing a new form of subjective judgment into a methodology valued for its objectivity.

Secondly, the definition of “principal asset is cryptoassets” lacks clarity, leaving several administrative questions open. It is unclear whether the test relies on parent-only or consolidated holdings, if exposure through subsidiaries or strategic equity stakes would be captured, or if indirect exposure via securities or derivatives counts. This ambiguity impacts which companies the rule applies to, undermining the objective, measurable, and consistently administrable rules essential for index methodology credibility.

Thirdly, the rule may be easier for companies to work around than to apply. If direct Bitcoin holdings are disfavored but equivalent economic exposure through other structures, such as the iShares Bitcoin Trust ETF (IBIT) or listed Bitcoin miners, is not, the rule becomes sensitive to legal form over economic substance. This asymmetry could incentivize issuers to restructure towards less transparent forms of exposure, which runs counter to a benchmark rule’s goal of encouraging clear disclosure.

Fourthly, an internal tension is created by the carve-out for existing constituents. The proposal defers new inclusions but does not apply the rule to current members. While this maintains stability, it poses a logical inconsistency: if Bitcoin treasury exposure is genuinely incompatible with TOPIX, exempting current members is difficult to justify. Conversely, if it is not incompatible, new entrants meeting the same investability criteria should not be treated differently.

Fifthly, the phrase “for the time being” leaves the timeline open-ended, lacking a specified review period, exit standard, or sunset mechanism. This open-ended timing is crucial, especially as October 2026 marks the first periodic review under the next-generation TOPIX framework where Standard and Growth market companies can become eligible through a new process. A deferral without a defined path to re-eligibility could function as a long-term exclusion.

Sixthly, global peers have taken a more cautious approach to this question. MSCI, after considering a threshold-based approach to digital-asset treasury companies, ultimately did not adopt a blanket exclusion, acknowledging the need for further work. FTSE Russell has not announced a comparable rule. This indicates that the classification of operating companies holding Bitcoin alongside other business lines remains genuinely unsettled within the global index community, suggesting JPXI could benefit from further engagement with market participants.

Finally, an asset-neutral framework would likely be more durable. If the core concern is that some listed companies have become overly concentrated or investment-like, this issue is not unique to cryptoassets. Concentrated holdings can involve listed equities, private-company stakes, real estate, or other non-operating assets. A framework consistently applied across these categories, perhaps through enhanced disclosure standards or an asset-neutral concentration framework, would address the underlying economic characteristic without creating specific asset class biases or definitional issues.

In conclusion, while JPXI’s instinct to carefully consider new categories of issuers is valid, the current proposal is deemed too narrow, vague, and open-ended. A clearer definition, a defined review period, and an asset-neutral framing would better address the concerns while preserving TOPIX’s reputation as an objective, rules-based benchmark reflecting the Japanese equity market. Bitcoin For Corporations has organized a coalition letter urging JPXI to withdraw the proposed exclusion, emphasizing that an approach prioritizing substance over form, clarity over ambiguity, and neutrality across asset classes represents a stronger path forward. The public comment period closes on May 7, 2026, and individuals and organizations are encouraged to sign the coalition letter.