Why Corporations should Sell Bitcoin

Recent Strategy made headlines By saying it may sell bitcoins to achieve business goals. Many people were surprised by this because it was thought that the company would never ever sell bitcoin. Saylor has even tweeted (jokingly). “Sell a kidney if you must, but keep the bitcoin.”

Bitcoin sales have always been on the agenda for bitcoin treasury companies. The saying of “never sell” This is a statement of long-term investing philosophy based on the low priority given to time in Bitcoin discourse. But within the Bitcoin discourse, it’s not uncommon to find situations where everyone is in agreement that selling makes sense, despite the ubiquity and popularity of the HODL concept. 

Simpler reasons include improving your quality of life. For example, you might want to buy a home to raise a growing family or pay for an expensive trip. This list is extensive. HODLing is not as common. 

The reason an organization does anything, and indeed why it exists is to increase shareholder value. 

Take a look at another bitcoin company that has sold. Then, consider another group of Bitcoin companies who have sold. Q1 Report The graph below shows that Bitcoin miners have sold 25 376 BTC during Q1 2026 in order to finance AI pivots. Value creation is simple. The management believes their AI capital expenditure will produce better returns, risk adjusted, than bitcoin. According to these assumptions it is logical that they would sell bitcoin in order to fund AI. This is the reason zero: If there’s a better investment, selling bitcoin to fund it makes perfect sense.

For Strategy—and all treasury companies that are focused on raising capital to accumulate bitcoin—there are clear cases where selling can create value. We’ll go over some of these. 

Bitcoins per Share

Most treasury strategy aims to increase Bitcoin per share. BTC yield is the period-over-period growth of BPS. BTC Yield can be achieved when Bitcoin is bought, which will increase the BPS Numerator. It can be obtained when you purchase shares, which reduces the BPS denominator. 

When shares are traded at a lower price than the Bitcoin they represent, selling bitcoins in order to buy them back will result in an increase of BPS. It is so because the percent of change in bitcoin is higher than that in outstanding shares. 

This rule is also applicable to obligations in progress (such a debt coupons and preferred stock dividends) which cannot be funded from operating cash flows. It is best to use bitcoins to cover these obligations if shares are trading at a discounted price. It would result in a lower decrease of BPS. 

Reason #2: Capital costs and capital raising 

Rating agencies are influential in how the capital market allocates funds. Their rules and guidelines must be followed to make capital formation easier. We began our annual review in December. published a report on Strategy’s historic S&P credit ratings. It discussed how companies can improve their ratings and, ultimately, lower the cost of capital for credit instruments. 

The cash reserve option, which was found in S&P’s comments and discussed in our report, was promptly adopted by Strategy. Strategy’s cash reserves were $2.2 billion by January 2026. This has significantly reduced investor concerns about the inability of Strategy to pay preferred dividends. 

It is fine for an organization to sell bitcoins to build up a cash reserve in order to calm the market and sell credit instruments with lower capital costs. It may seem complicated, but you need to go where your creditors are to convince them to pay you. You can’t avoid it. 

Bitcoin sales for debt repayment is another corollary. The debts, which are the senior liabilities of a company, reduces preferred stocks’ attractiveness as credit instruments. These debts can be retired and preferred stock could have a lower cost of capital. 

A lower cost of capital can be very valuable in the long run due to compounding, and to being able service more liabilities with more capital. For instance, it’s easier to compound if you pay 9% vs 11.5% — an extra 250 bps makes a very big difference over time. You pay less when you borrow $1 billion at 7% compared to $700 billion at 11%. 

Reason Number 3: Tax 

Bitcoin in the USA does not follow a rule of wash sales (as at writing). It is possible to sell the bitcoins in order to make a profit, and immediately purchase them again and lower their cost basis. It allows you to book a profit, which is a tax asset. Strategy had done this very thing in December of 2022 when the cycle was at its lowest point. 

It is a good idea to consider selling bitcoins today because this benefit of taxation still applies. Some people may not view it as a selling when the company immediately purchases. The company may be able to combine the tax benefits of realizing a loss with actions like share buybacks or debt forgiveness.

Proof that it’s possible 

Bitcoin is a relatively new currency and it comes with lots of FUD. The FUD can be ridiculous, but still catch on. This is a ridiculous example of FUD. The belief is that by selling strategy bitcoin, the balance sheet for bitcoin will be debunked. If they sell 50,000 BTC, and can prove that the Bitcoin market and stock are not affected, this will dispel these notions. The market may also be more open to accepting the corporate balance sheet bitcoin model.

This would certainly be the most ridiculous reason, but people sometimes come up with stupid ideas that need to be disproven. And one last point on this — the market is generally quite efficient; it is the media outlets and influencers that are incentivized to push sensationalist and poorly reasoned narrative out of whatever they can find. The real decision makers with the money seldom make their decisions on this basis. “sources” Over actual research

The fifth reason is preferred buyback 

It’s something that people rarely talk about. In the case of a de-peg, the firm has the right to purchase the instruments at a substantial discount from par. This allows them to retire obligations that have high capital costs.

The company owns preferred stocks, so this is closing an enticing short position with no tax and without borrowing. STRC is a $100 stock. If the stock drops to $82 and Strategy sells a billion dollars of BTC to buy back STRC at $82 per share, then it basically pocketed a gain of 100 – 82 = $18 per STRC share shorted (issued) and then repurchased. This gain is not taxable and Strategy did not have to borrow shares in order to short the stock. 

It is also important to know that this de-peg need not be followed by a collapse in bitcoin’s price. A wick-down can cause stop losses, momentum algorithms and a cascade selling if traders have a lot of leverage on STRC. In this instance, Strategy may sell BTC and retire STRC before suffering a higher payout (I assume that they will increase dividends to bring the stock back up to par). 

You can also read our conclusion. 

Be prepared for bitcoin purchases. In many cases, it’s in the best interest of both the company and the shareholders.

Bitcoin is currency. Money is the basis of choice. When used properly, options are fantastic.