Proposed French tax on regulated stablecoins could drive crypto traders offshore
In this news:
Key takeaways
- France is considering a new tax on regulated stablecoins that could push traders offshore.
- Lawmakers proposed mandatory declarations for self-hosted crypto wallets holding over €100,000.
- Concerns were raised regarding physical security risks tied to mandatory asset disclosures.
France considers stablecoin tax
Francois Volpoet, Chainalysis’ CEO for France, warned that the measure could undermine efforts to bring more crypto transactions into the regulated financial system.
“Do we want more taxpayers to declare their assets, or a higher tax rate applied to a base that is increasingly evaded?” Volpoet said in an email to CoinDesk. He said authorities can more easily monitor regulated stablecoin transactions than trades made through decentralized finance (DeFi) platforms or self-hosted wallets.
Wallet disclosure rules
Another amendment backed by the finance committee on Oct. 9 would require French taxpayers to declare self-hosted crypto wallets holding at least €100,000 ($116,000 approximately) in assets, with fines of up to $11,600 for failing to comply.
Volpoet raised concerns about the security of such disclosures, pointing to a rise in physical attacks targeting crypto holders in France. As of July, Europe recorded 39 of the 52 global incidents, with France alone responsible for 33, or 63.5% of the worldwide total.
Exit tax and loss carryforwards
Lawmakers also backed a proposal to extend France’s exit tax to crypto holdings worth roughly $900,000. The measure would bring unrealized crypto gains under the tax rules already applied to wealthy shareholders who move abroad.
A separate amendment backed on Oct. 7 would allow investors to carry forward crypto losses for up to 10 years, bringing their tax treatment closer to that of stocks.
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