Two questions underlie any long-term Bitcoin position, and most holders never address either deliberately. The first: what the tax picture looks like if they sell some. The second: assuming self-custody anchors most of the position, where the rest sits.
I have been in Bitcoin for 13 years. Before that, nine years as CIO of a near ten-digit family office, where I tripled the book without owning any.
The most useful thing we did there had nothing to do with Bitcoin. We set up our own Opportunity Zone fund, which is why I know the program cold. I also know Bitcoin cold. It never once occurred to me to put the two together.
Then Alec Beckman and I sat down with Brian Phillips of the Pearl Bitcoin Fund. The moment he described what he had built, the first of those two questions reframed itself. Credit where it is due. He saw a combination I had not.
What an Opportunity Zone actually does
Created in 2017, the program channels private capital into underdeveloped census tracts. A holder reinvests a realized capital gain into a Qualified Opportunity Fund within 180 days. The fund invests in qualifying property or business inside a designated zone. Tax on the original gain is deferred. Hold for at least 10 years, and the appreciation comes out free of capital gains tax.
The incentive is one of the tax code's most generous, and it is not a loophole. Treasury watches closely. The structure must create real activity in the zone, including jobs for people who work there.
What changed in 2025, and what didn't
The capital-gains deferral was set to expire on December 31, 2026, which made 10-to-30 year structures hard to underwrite.
The One Big Beautiful Bill Act, signed in July 2025, made the program permanent. Two details matter for planning today.
The new rolling 5-year deferral applies only to investments made after December 31, 2026. Capital placed this year still falls under the prior rules, with the 2026 deferral cliff and the 10-year appreciation exclusion intact.
After January 1, 2027, the rolling deferral takes effect. The 10-year appreciation exclusion runs to a 30-year cap on the fair-value step-up, replacing the original 2047 sunset.
Permanence changes the calculus. A 10-to-30 year structure becomes underwriteable when it stops depending on Congress to renew it.
A property, not a security
In 2014, the IRS classified Bitcoin as property, not a security. Most of what U.S. tax law does for Bitcoin holders traces back to that classification, and one provision matters here.
The wash-sale rule disallows a loss on a security if the investor buys the same security within 30 days before or after the sale. Bitcoin sits outside it. A holder with unrealized losses can sell, claim the loss against other gains, and reacquire immediately without forfeiting the deduction.
This is not a loophole, but a consequence of classification. Legislation to extend wash-sale treatment to digital assets has been proposed in several Congresses and has not passed.
Combined with an Opportunity Zone structure, the sequencing is useful. Harvest losses against other gains, reacquire at a lower basis, then move that lower-basis position into the tax-free envelope. It works for gains not yet realized, not ones already booked.
One structure built around it
The Pearl Bitcoin Fund, described by Phillips as the first Bitcoin-only Opportunity Zone fund, applies the program to Bitcoin. A holder places a realized capital gain into the fund, which acquires Bitcoin on the OTC market through an Opportunity Zone asset management company in a Harlem zone.
The Bitcoin sits in institutional custody. It does not have to live inside the zone, but the qualifying jobs do. The position is not rehypothecated, and holdings are visible on the blockchain.
Pearl has named Anchorage Digital as custodian, Morgan Stanley for cash management, HC Global as administrator, and Deloitte as tax counsel. Tax counsel renders opinions on the structure, not endorsements. Evaluate the fund on its documents, not its service providers.
Bitcoin's liquidity lets the fund permit redemptions every 30 days, unusual for an Opportunity Zone vehicle. And because a trust structure inherits the holder's clock, a position can pass to heirs without recognition even if the holder does not live to the end of the 10-year window. Confirm both against the fund's own materials before acting, including against what is described here.
The other half of the question
The tax envelope answers the first question. The second is harder: where does the position sit while the holder is not selling?
The 2022 cycle made the lesson clear, and this readership has internalized it. Holders who surrendered control for a promised yield learned that the yield was disclosed and the risk was not. Those structures are not coming back, and they should not.
A narrower question has matured since, and applies only at the margin. For holders with the risk budget, operational tolerance, and allocation size to consider productive Bitcoin seriously, the question is no longer the headline yield. It is whether the Bitcoin remains under their control, and whether every exposure can be inspected, bounded, and exited on their terms.
Psalion is one of the firms doing this work. Our starting position is that self-custody anchors any serious allocation, and that a different arrangement earns a place only when the holder can see and bound the risk it introduces.
Whether that argument fits any given mandate is a question for the mandate, not for the firm describing the option.
Build it before you need it
The holders who come out of the next decade in the best shape will not be the ones who got lucky on the price. They will be the ones who thought about the full picture before the hold. What the tax bill looks like if they sell some. Where the rest sits while they don't.
The plan is not complicated. But it has to be built before it is needed. By the time it is needed, it is too late.
Watch or listen to the full conversation with Tim Enneking, Alec Beckman and Brian Phillips:
Visit Psalion.com or contact Tim's team to learn how Psalion generates yield on institutional Bitcoin holdings through segregated managed accounts.
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