MicroStrategy (MSTR) has issued a redemption notice for its 2027 convertible senior notes, valued at $1.05 billion, allowing noteholders to redeem their securities or convert them into Class A stock at approximately $142 per share. The deadline for redemption is February 24, 2025.

The move coincides with growing concerns over the Corporate Alternative Minimum Tax (CAMT), a provision in the Inflation Reduction Act of 2022, which could impose taxes on $19 billion in unrealized capital gains. Critics argue such a tax, particularly on volatile assets like Bitcoin, could deter investment and disrupt corporate strategies. MicroStrategy, along with Coinbase, has opposed the CAMT in a joint letter to the IRS, describing the tax implications as "unjust and unintended."

MicroStrategy, the largest corporate holder of Bitcoin, surpassed 450,000 BTC in January 2025, with its holdings now standing at 461,000 BTC, valued at $49 billion. Its latest acquisition of 11,000 BTC marks the largest purchase of the year, reflecting the company’s aggressive Bitcoin strategy.

While this strategy has delivered significant returns, with a 68% gain on its Bitcoin investment, experts caution against potential risks. David Krause, a finance professor at Marquette University, warned that Bitcoin’s price volatility could threaten the company’s financial stability. Sharp declines in Bitcoin’s value could compromise its ability to repay debts, posing risks of insolvency.

The market reaction to the redemption notice has been mixed, with debates intensifying over unrealized capital gains taxes and their impact on digital asset investors. As MicroStrategy continues to navigate these challenges, its Bitcoin treasury strategy remains a focal point of both admiration and skepticism in the crypto and finance worlds.