Buy, borrow, die strategy explained — and how crypto holders can utilize it

In May 2026, Jeff Bezos told CNBC there was "no truth" to the buy, borrow, die strategy. 

One week later, Michael Saylor's company Strategy sold Bitcoin for the first time in four years — a small, pre-announced sale to cover dividend payments on the preferred stock tied to its leveraged corporate treasury.

Two headlines. One lesson: the strategy is real, it works, and what determines whether it works for you is how you build it. For crypto holders, the practical question is simpler than the billionaire version — should you borrow against your crypto instead of selling it?

The short version: 

Buy, borrow, die is a wealth strategy where you accumulate appreciating assets, borrow against them for liquidity instead of selling, and pass them on. No sale means no capital gains event. Crypto-backed credit lines make this strategy available to individual holders, not just billionaires. And unlike a bank loan or margin account, a crypto credit line can be near-instant, requires no credit check, and comes with no fixed repayment schedule.

What is the buy, borrow, die strategy?

The name sounds dramatic. The concept is straightforward.

Wealthy investors accumulate assets they expect to rise in value — historically, real estate, stocks, and art. When they need liquidity, they borrow against those assets rather than selling them. The loan isn't taxable income. The asset keeps appreciating. When the investor eventually passes away, the stepped-up cost basis provision in US tax law resets the gain for heirs, potentially erasing the capital gains liability built up over decades.

The three steps:

• Buy — acquire assets that tend to appreciate over time
• Borrow — use those assets as collateral for a loan instead of selling
• Die — pass the assets to heirs, who inherit them at current market value

What "die" actually means: the stepped-up basis rule

The third step works because of a provision in the US tax code called stepped-up basis. In plain terms, when you inherit an asset, its cost basis resets to the market value on the day the owner died. The gain that is built up over the owner's lifetime is never taxed. Capital gains tax is only triggered by a sale, and death isn't a sale.

An illustrative example makes the size of this clear.

Maria bought 2 BTC in 2017 for $10,000. By 2046, they're worth $900,000. She never sold — when she needed cash over the years, she borrowed against the BTC and repaid from income. 

If Maria sells before she dies, she realizes an $890,000 gain. At a 20% long-term capital gains rate, that's roughly $178,000 in tax.

If Maria dies holding the BTC, her son inherits it with a cost basis of $900,000 — the value on the day she died, not the $10,000 she paid. If he sells a week later for $905,000, his taxable gain is $5,000. Tax owed: roughly $1,000.

One timeline costs the family $178,000; the other, about $1,000. The only difference is that nobody sold while Maria was alive.

Two things the example doesn't erase: any outstanding loan still gets repaid by the estate, and estate tax is a separate calculation — though it only applies above roughly $15 million per person under current US law, so it never enters the picture for most holders.

The most cited practitioners include Larry Ellison and Elon Musk, who have used their stock holdings as collateral for large personal loans. Regardless of what any billionaire does or says, the strategy's core logic is sound and has been for decades.

Important note: Other jurisdictions may treat inherited assets differently, and several countries are reviewing how borrowing against appreciated assets is taxed. The "buy" and "borrow" steps, however, work the same way almost everywhere — and they're where the practical value sits for most holders.

How the strategy works for individual crypto holders

The individual version of buy, borrow, die is simpler and more flexible than the corporate version.

You hold Bitcoin, Ethereum, or another major asset. When you need funds — for a home renovation, a business opportunity, or to cover a period of lower income — you pledge your crypto as collateral and borrow against it. You receive funds in the form of stablecoins. 

Your crypto is locked, but stays in your account. You repay on your own schedule. For a full walkthrough of how this works in practice, see Borrowing against your Bitcoin: the basics.

Say you've held 1 BTC since it was worth $40,000, and it's now worth $62,000. Selling means realizing a $22,000 gain and potentially owing tax on it, depending on your jurisdiction. Borrowing against it gives you access to a portion of that value while your BTC stays unsold.

If Bitcoin recovers to $80,000 or higher, you still hold it. The loan gets repaid from income, savings, or even from the appreciation itself. As your collateral rises in value, your loan shrinks relative to it, and selling just a small slice of the now more valuable holding can clear the debt while the rest of your position stays untouched. The asset ends up paying for its own liquidity.

And unlike a corporate treasury, there are no fixed dividend schedules, shareholder pressure, or obligations that force your hand on a timeline you didn't choose. You borrow when it makes sense and repay when it suits you.

Where crypto improves on the traditional model

Traditional buy, borrow, die requires wealth to access. A securities-backed loan from a private bank typically requires a substantial asset minimum and takes days or weeks to process. A HELOC requires property ownership, a credit check, an appraisal, and underwriting. Neither is accessible to most people.

Crypto changes the entry point in three specific ways.

Speed. A crypto-backed credit line can be approved and funded in hours, not weeks. There's no underwriting process, no appraisal, and no waiting for a bank to decide.

Flexibility. There's no fixed repayment schedule. You repay when it suits you — in full, in part, or over time — as long as your loan-to-value ratio stays within the agreed threshold. 

Accessibility. You don't need a $500,000 stock portfolio. Any meaningful holding of Bitcoin, Ethereum, or other accepted assets is enough to start. The private banking playbook, without the private banking requirements.

See how Nexo's crypto credit line works and how much you can borrow against your holdings.

What to watch out for

The strategy has real risks. Being clear about them is part of using it well.

Collateral value can drop. If your crypto falls sharply in price, your loan-to-value ratio rises. At a set threshold, you may need to add more collateral or repay part of the loan to avoid forced repayment. This is the core risk of any borrowing built on a volatile asset.

The mitigation: Borrow conservatively. If you borrow 20–30% of your collateral's value, you have significant room before the position becomes stressed. Borrowing close to the maximum does not.

Interest still applies. A crypto-backed loan isn't free money. You pay interest on what you borrow. The question is whether that cost is lower than the cost of selling your position, which it often is, particularly if a sale would trigger a meaningful capital gains liability. If you're weighing the two options directly, Borrow against Bitcoin or sell? walks through the comparison in detail.

Tax treatment varies. In most jurisdictions, taking out a loan is not a taxable event. But the rules differ by country and are actively changing — seven bills related to crypto taxation were circulating in the US House Ways and Means Committee as of June 2026, and proposals to tax borrowing against appreciated assets have been formally studied. Consult a qualified tax professional before making decisions based on tax considerations.

Important note: These materials are for general information purposes only and are not intended as financial, legal, tax, or investment advice.

What Saylor's Bitcoin sale actually tells us

Strategy holds 843,706 Bitcoin — the largest corporate Bitcoin treasury in the world. Between May 26 and May 31, 2026, the company sold 32 of them to cover a routine dividend payment on its preferred stock. That's 0.004% of the position, generating $2.5 million against a $60+ billion holding. Saylor had signaled the move weeks earlier on the company's earnings call, framing it as the financially sensible way to meet the obligation.

The crypto market proceeded to lose $160 billion in value over the following week.

The reaction tells you more about sentiment than it does about Strategy. Saylor didn't abandon his thesis. He managed a small, planned corporate obligation the way any disciplined treasurer would — and days later, when Bitcoin dipped, he was preparing to buy again.

That's actually the buy, borrow, die strategy working as intended. Hold the position. Cover short-term obligations without meaningfully touching the core holding. Resume accumulation when conditions allow.

Putting it together

Buy, borrow, die isn't a loophole or a shortcut. It's a disciplined approach to liquidity built on the principle that selling an appreciating asset is often the most expensive way to access funds.

Wealthy investors have used this logic for generations — with property, with equity, with art. Crypto makes it accessible to anyone with a meaningful holding, not just those with private bankers and minimum account thresholds. Borrow conservatively, keep your position intact, and let time do what it does for appreciating assets.

And for holders who aren't ready to borrow yet, putting crypto to work through savings products is a natural first step — your assets grow in the background while you decide what to do next.

Not ready to borrow yet? Start by putting your crypto to work.

Frequently asked questions

1. What is the buy, borrow, die strategy? 

A wealth strategy where you accumulate appreciating assets, borrow against them for liquidity instead of selling, and pass them to heirs. Because borrowing isn't a taxable event in most jurisdictions, you access the value of your assets without triggering capital gains.

2. Should I borrow against my crypto instead of selling it? 

It depends on your time horizon and tax position. Borrowing preserves your holding and avoids a capital gains event; selling ends both. If you believe in the asset long term and a sale would realize a significant gain, borrowing conservatively is often the cheaper way to access liquidity. If you need to exit the position anyway, selling may be simpler.

3. Is borrowing against crypto a taxable event? 

In most jurisdictions, taking out a loan is not taxable. However, tax treatment varies by country and is subject to change, including active legislative proposals in the US. Always consult a qualified tax professional before acting on tax-sensitive strategies.

4. What is the stepped-up basis? 

A US tax rule under which inherited assets reset their cost basis to the market value on the date of the owner's death. The appreciation that accumulated during the owner's lifetime is never subject to capital gains tax. It's the mechanism that makes the "die" step of the strategy work — and it applies to crypto the same way it applies to stocks or property.

5. What assets can you borrow against? 

Traditionally, stocks, real estate, and other appreciating assets. Crypto platforms extend this to Bitcoin, Ethereum, and other major digital assets. Accepted collateral varies by platform.

6. What happens if crypto prices drop while I'm borrowing? 

Your loan-to-value ratio rises. If it crosses a set threshold, you may need to add more collateral or repay part of the loan. Borrowing conservatively — well below the maximum available amount — significantly reduces this risk.

7. Why did Strategy sell Bitcoin if Saylor believes in it so strongly? 

The sale — 32 coins out of 843,706 — was pre-announced and covered a routine dividend payment on preferred stock. It represented 0.004% of Strategy's position and $2.5 million against a $60+ billion holding. The market reaction was far larger than the event warranted, and Saylor's long-term thesis remained unchanged throughout.

These materials are accessible globally, and the availability of this information does not constitute access to the services described, which services may not be available in certain jurisdictions. These materials are for general information purposes only and not intended as financial, legal, tax, or investment advice, offer, solicitation, recommendation, or endorsement to use any of the Nexo Services and are not personalized, or in any way tailored to reflect particular investment objectives, financial situation or needs. Digital assets are subject to a high degree of risk, including but not limited to volatile market price dynamics, regulatory changes, and technological advancements. The past performance of digital assets is not a reliable indicator of future results. Digital assets are not money or legal tender, are not backed by the government or by a central bank, and most do not have any underlying assets, revenue stream, or another source of value. Independent judgment based on personal circumstances should be exercised, and consultation with a qualified professional is recommended before making any decision.

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