Shai Gilgeous-Alexander of the Oklahoma City Thunder is poised to make NBA history by signing the largest contract ever seen in the league after winning the 2024-25 Most Valuable Player award. This achievement grants him eligibility for a significantly increased salary, timed perfectly as he approaches his next contract renewal.
Winning the MVP not only recognizes his skill and impact on the court but also triggers eligibility for a higher maximum salary, a benefit reserved exclusively for award winners compared to non-winners. With his contract set to be renegotiated soon, Gilgeous-Alexander’s new deal is expected to rewrite salary benchmarks in professional basketball.
Current Contract Status and Eligibility for Extension
Presently, Gilgeous-Alexander is midway through a five-year contract extension signed in August 2021, which extends his tenure with the Thunder until 2027. This agreement followed his initial four-year rookie scale contract, standard for first-round NBA draft picks. The terms of the NBA’s contract extension rules limit eligibility, but top-tier players like Gilgeous-Alexander often extend without entering free agency, potentially remaining with one team throughout their careers.
Veteran contracts can be extended after two years from their signing date, but if extended previously to cover five or six seasons, further extensions only become possible three years after the last one. Since Gilgeous-Alexander’s current extension runs from 2021 to 2027, he has been eligible to sign a new extension since August 2024. By deferring this decision, he stands to gain a more lucrative contract.
Determining Factors Behind Maximum NBA Salaries
NBA salary caps are influenced by multiple elements, including a player’s years of experience and their existing contract size, but primarily hinge on the league’s salary cap set annually. Due to recent increases in basketball-related revenues, especially from new television deals, the NBA’s salary cap is projected to rise sharply over the coming years.
For the 2023-24 season, the cap is approximately $140.6 million. While technically a ‘soft cap’—allowing certain exceptions that enable teams to exceed this limit—the cap figure serves as the foundation to calculate the maximum salary a player can earn. By the 2027-28 season, the cap is forecasted to reach around $187.1 million, nearly tripling since the 2015-16 season.
This dramatic increase creates the conditions for record-breaking contracts, and as MVP, Gilgeous-Alexander will be the first player to capitalize on these elevated limits.
Understanding the Designated Veteran Status and Supermax Contracts
The NBA’s Collective Bargaining Agreement offers mechanisms that enable teams to extend larger and longer contracts to their top veteran players. Two critical elements are the Designated Veteran rule, which allows longer contract terms, and the Designated Veteran Player 35% Max Criteria—commonly known as the ‘supermax‘—which permits significantly higher salaries.
This framework lets a team sign certain players, specifically those with eight or nine years of league service classified as Designated Veterans, to contracts up to six years long with a salary starting at 35% of the salary cap. Typically, players with fewer than ten years of service can only sign contracts beginning at 30% of the cap, making the Designated Veteran status particularly valuable.
To qualify as a Designated Veteran, a player must meet several requirements:
- Continuous service with the same team through their initial rookie extension,
- Seven or eight years of NBA experience at the time of the veteran extension,
- And fulfill at least one of the following conditions:
[A] Being named Defensive Player of the Year in the previous or one of the two seasons before,
[B] Selected to the All-NBA first, second, or third teams in the prior or two preceding seasons, or
[C] Having won the MVP award in any of the three seasons immediately before.
By securing the MVP award, Gilgeous-Alexander meets the criteria. When the new NBA season begins on July 1, he will be a seven-year veteran, having played solely for the Thunder, thus meeting all prerequisites for Designated Veteran status.
Timing of Signing a Designated Veteran Extension Could Increase Salary
Once the new season commences on July 1, Gilgeous-Alexander has the window until the start of preseason play to sign a Designated Veteran extension, which could last through the 2030-31 season. However, if he delays signing until the summer of 2026, the extension could be longer and even more lucrative.
Currently under contract through 2027, if Gilgeous-Alexander signs this year, his extension would cover five additional years. Waiting a year would allow for a six-year extension, running through 2032, potentially inflating his total earnings significantly beyond the current record.
Projected Numbers Indicate Record-Breaking Earnings for Shai
Using the NBA’s predicted salary cap of $187.1 million for the 2027-28 season, and assuming Gilgeous-Alexander receives the 35% maximum salary permitted for a Designated Veteran along with the highest annual raise of 8%, projections suggest the following contract values:
- 2026-27: $40,806,150 (final year of current contract)
- 2027-28: $65,493,050 (first extension year at 35% of cap)
- 2028-29: $70,732,494
- 2029-30: $75,971,938
- 2030-31: $81,211,382
- 2031-32: $86,450,826
- Total extension (five years): $379,859,690
This anticipated contract eclipses the current largest NBA deal, which is Jayson Tatum’s five-year supermax extension with the Boston Celtics, expected to total $313,933,410. Gilgeous-Alexander’s deal could exceed Tatum’s by more than $65 million, underscoring the shifting financial landscape in professional basketball.
Significance of Gilgeous-Alexander’s Contract in NBA History and Future Trends
Shai Gilgeous-Alexander’s upcoming contract represents a milestone that not only rewards his elite performance but also highlights the NBA’s evolving economic framework. As salaries rise alongside the league’s expanding revenue streams, this record-setting deal establishes new standards for player compensation.
This shift reflects broader trends where star players can secure longer, more lucrative contracts, potentially encouraging player retention and long-term team continuity. Gilgeous-Alexander’s ability to negotiate a contract of this magnitude signals his intention to remain central to the Oklahoma City Thunder’s future while demonstrating how the NBA continues to grow its financial stakes.