Buy, Borrow, Die is a strategy in which an investor purchases an asset, uses it as collateral to borrow against to access funds without selling it, and then holds onto the asset until their passing, at which point it can be passed on to heirs with a stepped-up cost basis.
In the context of cryptocurrency, this strategy involves buying a cryptocurrency, using it as collateral to borrow stablecoins or fiat currency, and then holding onto the cryptocurrency until the investor’s passing. This allows the investor to access funds without triggering capital gains taxes from selling the cryptocurrency. When the investor passes away, their heirs can inherit the cryptocurrency with a stepped-up cost basis, potentially reducing or even eliminating capital gains taxes if they choose to sell.
Overall, Buy, Borrow, Die is a tax-efficient strategy that allows cryptocurrency investors to access liquidity without triggering capital gains taxes, while also potentially providing tax benefits for heirs when they inherit the assets.
