When in doubt ask AI - MSTR shareholders like myself might soon be taxed on unrealized gains.
Your query builds on the ongoing real-world scenario where Strategy (formerly MicroStrategy) is already facing taxation on unrealized gains from its Bitcoin holdings—over 580,000 BTC as of July 2025, valued at ~$68 billion with cumulative unrealized gains exceeding $28 billion. This stems from the 15% Corporate Alternative Minimum Tax (CAMT) under the 2022 Inflation Reduction Act, which applies to large corporations' adjusted financial statement income (AFSI), including unrealized gains on assets like BTC after the FASB's ASU 2023-08 update allowed fair-value accounting starting January 1, 2025. Saylor, as executive chairman, has long advocated for this accounting shift to better reflect BTC's value, but it inadvertently triggered these tax liabilities. As of June 30, 2025 (end of Q2), Strategy reported $14.05 billion in quarterly unrealized gains and ~$6.31 billion in deferred tax liabilities tied to BTC—potentially leading to billions in actual payments starting in 2026 if unchanged. Below, I'll outline what Saylor and Strategy have already done in response, then reason through what they'd likely do if pressures intensify (e.g., higher rates, immediate enforcement, or broader crypto taxes), based on his public philosophy, historical actions, and recent moves.
### What They've Already Done
Strategy hasn't sold any BTC to cover taxes—aligning with Saylor's "HODL forever" ethos—and instead treats these as deferred liabilities on the balance sheet, meaning no immediate cash outflow but a growing obligation. Key actions include:
- **Lobbying and Advocacy**: Saylor and Strategy joined other crypto firms (e.g., Coinbase) in pushing the IRS and Treasury for exemptions, arguing unrealized gains shouldn't count toward CAMT to avoid stifling innovation. In January 2025, they requested guidance to exclude crypto from these rules, emphasizing BTC as a long-term treasury asset. Saylor has publicly criticized unfair taxation on X, quoting figures like Ronald Reagan and Donald Trump to frame it as government overreach, while promoting BTC as tax-efficient (e.g., deferred gains until sale).
- **Capital Raises to Avoid Selling BTC**: To manage liabilities without liquidating holdings, Strategy has leveraged its soaring stock price (up ~400% YTD on BTC correlation) for equity offerings. In July 2025, they announced a $4.2 billion stock sale, likely to fund operations, debt reduction, or tax buffers. Earlier, in January 2025, they planned a $1.05 billion debt buyback amid tax uncertainty, using proceeds to retire high-interest debt and preserve BTC. This "Bitcoin yield" strategy—issuing shares/debt to buy more BTC—effectively dilutes shareholders but generates returns far outpacing tax costs (e.g., 59% "yield" in 2024).
- **Continued Accumulation**: Despite the tax hit, they've bought more BTC, adding ~130,000 in H1 2025 alone, signaling confidence that gains will compound faster than liabilities. Saylor views taxes as a "maturity" issue for the asset class, arguing normalized rules will reduce volatility and attract institutions.
### What Would Saylor Likely Do If Taxed More Heavily?
Saylor's track record shows a pragmatic, aggressive approach: Treat BTC as "digital property" immune to full impairment, fight politically/legally, and use financial engineering to protect shareholders without selling. He's dismissed doomsday scenarios (e.g., outright bans) and emphasized BTC's tax advantages over fiat (e.g., no annual property tax, deferred gains). In a escalated tax scenario (e.g., CAMT enforcement in 2026 demanding $3-5 billion annually, or new unrealized gains taxes), here's my step-by-step speculation:
1. **Amplify Public and Political Pressure**: Saylor would ramp up advocacy, using X and media to rally Bitcoiners against "unfair" taxes, framing them as innovation-killers that drive capital offshore. He'd likely endorse pro-crypto politicians (as with Trump's anti-crypto-tax stance) and collaborate with groups like the Blockchain Association for lawsuits challenging CAMT under constitutional grounds (e.g., as an unconstitutional wealth tax). His 2021 advice to Elon Musk—convert balance sheets to BTC for tax efficiency—suggests he'd push corporations toward similar strategies.
2. **Financial Maneuvering to Defer or Offset**: Rather than sell BTC (which would trigger even more capital gains taxes at 21-37% rates), he'd prioritize non-dilutive funding:
- **Equity/Debt Issuances**: Scale up ATM (at-the-market) offerings, as done recently with $4.2 billion, to raise cash for tax payments while buying more BTC during dips. This creates a "virtuous cycle" where BTC appreciation funds taxes.
- **Debt Restructuring**: Buy back expensive debt (e.g., the January 2025 $1.05B plan) and issue cheaper BTC-collateralized notes, using unrealized gains as leverage without realization.
- **Tax Planning Tools**: Explore offsets like net operating losses (Strategy has ~$3B in NOLs) or international structures, though BTC's global nature limits this. Saylor has highlighted BTC's portability as making it "hardest to tax."
3. **Strategic Shifts If Forced**: In extremis (e.g., taxes eroding shareholder value), he might:
- **Partial Sales or Yields**: Reluctantly sell small BTC tranches to cover exact liabilities, but only as a last resort—recent reports hint at this possibility for 2026. Alternatively, introduce "Bitcoin yields" via dividends or spin-offs to distribute value tax-efficiently.
- **Corporate Reorganization**: Spin off BTC holdings into a separate entity (e.g., a trust or offshore vehicle) to shield from U.S. taxes, though SEC rules complicate this.
- **Diversification Push**: Accelerate institutional adoption (e.g., via ETFs) to normalize BTC, reducing tax scrutiny—Saylor sees this as stabilizing volatility.
Overall, Saylor would view heavy taxation as validation of BTC's threat to fiat systems, doubling down on accumulation and advocacy while using Strategy's market cap (~$50 billion) as a war chest. This could dilute shareholders short-term but aligns with his maximalist view: BTC gains will outpace taxes long-term. Critics argue this risks insolvency if BTC dips, but his actions substantiate a "fight, not flight" strategy—politically incorrect to tax hawks, but rooted in BTC's deflationary design. If regulations evolve favorably (e.g., exemptions by 2026), he'd claim victory for the ecosystem.
