Disclosure: The author of this story owns shares in Strategy (MSTR).

When Executive Chairman Michael Seiler confirmed on Strategy’s ( MSTR ) Q1 2026 earnings call on May 6 that the company is ready to sell bitcoin, it seemed to mark a turnaround for the world’s largest publicly traded corporate holder of the cryptocurrency. But this move will not be unprecedented. In December 2022, the strategy sold bitcoin for tax loss harvesting purposes — the same rationale the company is now once again signaling to the market.

On 22 December 2022, Strategy Sold 704 bitcoins for about $11.8 million at $16,776 per coin, but immediately bought back 810 bitcoins two days later.
The sale was designed to carry back capital losses against previous gains and obtain a tax benefit. Tax loss carryforward event.

“MicroStrategy intends to carry back capital losses resulting from this transaction, to the extent such carrybacks are available under currently applicable federal income tax laws, which may result in a tax benefit”.

Bitcoin fell 23% from $87,500 to $67,700 in the first quarter of 2026. Under FASB fair value accounting rules adopted on January 1, 2025, the strategy marks its entire bitcoin holdings to market each quarter, posting a $12.54 billion loss in Q1 that pushed unrealized losses directly through the income statement and created a $2.2 billion deferred tax asset based on its higher cost basis.

According to the MSTR earnings call, assuming an $80,000 bitcoin price, the strategy has a $7.6 billion unrealized loss over $80,000 and a $2.2 billion deferred tax asset that bought 434,000 BTC at a 29% tax rate.

If bitcoin recovers and the strategy sells valuable bitcoins, this $2.2 billion tax could offset future gains.

The Company’s primary objective is to increase “bitcoins per share,” which is the ratio of the strategy’s total bitcoin holdings to its total shares outstanding.

Using proceeds from the bitcoin sale to retire $8.2 billion of convertible debt, MSTR is to buy common stock when the multiple falls below 1.22x net asset value or fund $1.5 billion in annual dividend obligations from its permanent preferred stock stretch (STRC).

MSTR is up 1% in premarket trading, while bitcoin trades above $81,000.