Key Highlights:
- The French National Assembly has approved a tax amendment targeting stablecoin conversions, moving to eliminate the tax deferral currently applied to crypto-to-crypto transactions.
- Under the proposed rules, shifting from crypto assets into e-money tokens pegged to an official currency would immediately crystallize capital gains, subjecting investors to taxation before off-ramping to fiat.
- The draft measure revises capital gains calculation methods and sets transition rules ahead of a scheduled final vote on the overall 2027 budget on November 17.
Assembly Backs Measure to Tax Stablecoin Conversions
In a significant shift for digital asset regulation, the French National Assembly has demonstrated full parliamentary backing for an amendment addressing the tax treatment of stablecoins. The vote took place on October 16, with 25 deputies choosing to abstain, reversing the momentum after the parliamentary finance committee had earlier rejected the first portion of the budget following its initial review period held between October 7 and October 9.
The core of the legislative change targets the long-standing tax deferral mechanism available to cryptocurrency traders. Under current guidance from tax authorities, exchanging one cryptocurrency for another without a cash adjustment does not trigger an immediate taxable event. When tax is ultimately due, individual retail investors are generally subject to a 31.4% flat tax rate on their taxable gains—comprising a 12.8% income tax and 18.6% in social security contributions—with the alternative option to be taxed under progressive income-tax brackets.
Eliminating Deferrals for E-Money Tokens
The newly approved amendment explicitly removes crypto-to-crypto deferrals when digital assets are converted into e-money tokens. Utilizing the regulatory framework outlined in the European Union’s Markets in Crypto-Assets (MiCA) regulation, the measure defines e-money tokens as digital assets designed to maintain a stable value relative to a single official currency. Rather than restricting enforcement to a registry of approved token issuers or digital asset trading platforms, the statutory language relies strictly on this functional definition under MiCA.
Practically, this revision means that market participants will trigger an immediate capital gains tax liability as soon as they move volatile crypto holdings into fiat-backed stablecoins, even if the proceeds remain entirely on-chain without being withdrawn into a traditional bank account or conventional legal tender.
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Updated Acquisition Cost and Capital Gains Calculations
Beyond ending tax deferrals on stablecoin swaps, the provisional legal text establishes an overhauled methodology for determining taxable gains. Capital gains will be measured as the difference between the gross disposal proceeds and the acquisition price of the specific assets offloaded. When investors hold multiple batches of the same digital asset acquired at varying price levels, the law prescribes a weighted-average acquisition cost method.
To ease the administrative burden for historical holdings, the amendment introduces transitional rules for digital assets acquired prior to 2027. Investors will be granted an option: they can calculate liabilities based either on substantiated historical acquisition costs or through an allocation of their portfolio’s existing acquisition cost calculated from year-end asset valuations.
Why This Matters
For years, crypto traders have utilized dollar- or euro-pegged stablecoins as safe harbors during market downturns, preserving portfolio value on-chain without creating a reportable tax event. By treating conversion into e-money tokens as a realization of gain, the French legislature is seeking to close what tax policymakers view as an ongoing loophole.
This initiative aligns domestic tax mechanisms with the EU’s wider MiCA classification standards. The immediate focus now turns to the legislative calendar: the Assembly is scheduled to vote on the second portion of the finance bill and the full 2027 budget on November 17, which will decide the ultimate adoption of the new stablecoin taxation framework.
Frequently Asked Questions
How are cryptocurrency gains currently taxed for private investors in France?
Under current rules, trading one cryptocurrency for another remains tax-deferred as long as there is no cash adjustment. Realized gains from cashing out into fiat currency face a standard 31.4% flat tax (12.8% income tax plus 18.6% social charges), though investors can opt for the progressive income-tax scale.
What changes under the newly approved stablecoin amendment?
Exchanging cryptocurrencies for MiCA-defined e-money tokens (stablecoins pegged to an official currency) will no longer qualify for tax deferral. Converting assets into stablecoins will trigger an immediate taxable event, crystallizing capital gains even if the investor does not withdraw to a traditional bank account.
When will the French National Assembly hold a final vote on the budget?
According to the Assembly’s published calendar, a parliamentary vote on the second part and the entire 2027 budget is scheduled for November 17.
