As part of a flurry of late-year transactions, MicroStrategy sold about 704 bitcoins at an average price of $16,776 on December 22, the first time the company had divested any holdings of the leading cryptocurrency. But that followed purchases of about 2,395 tokens for about $17,871 each from November 1-December 21.that it planned to use losses generated by the sale to diminish previous capital gains, which could result in tax benefits.
The strategy takes advantage of bitcoin’s status as a commodity that is not subject to the wash-sale rules for securities, under which a seller must wait 30 days to repurchase an investment in order to book the tax loss. In the case of MicroStrategy’s bitcoin portfolio, the benefit may be large. Indeed, says Shirish Jajodia, the vice president of treasury and investor relations at MicroStrategy, “There is no change to our bitcoin strategy, which is to acquire and hold bitcoin for the long term.”