French lawmakers vote 38 to 37 to tax crypto-to-stablecoin swaps from 2027

France’s National Assembly voted 38 to 37 on October 16 to scrap the tax deferral on crypto-to-stablecoin swaps, a change that would make selling bitcoin for euro-backed or dollar-backed tokens a taxable event from January 2027 if it survives the budget process.

The proposal targets a specific gap in the existing tax treatment of digital assets. Under the current framework described by its sponsors, converting cryptocurrency into euros or dollars can trigger taxation on realized gains, while exchanging crypto for qualifying stablecoins generally benefits from a tax deferral.

Sansu argued during the parliamentary debate that this distinction creates an unjustified advantage for investors who move into stablecoins instead of conventional currency.

He said the amendment seeks to eliminate the tax deferral benefiting crypto-to-stablecoin conversions, arguing that gains from these transactions should not escape taxation simply because investors remain within the digital-asset ecosystem.

The proposal would amend France’s existing capital gains rules to remove that deferral for qualifying exchanges involving electronic money tokens under the European Union’s Markets in Crypto-Assets Regulation (MiCA). Its provisions are designed to apply from January 1, 2027, if enacted.

Stablecoin swaps could trigger taxable gains

The proposed reform could affect investors who sell Bitcoin (BTC) or other cryptocurrencies for eligible stablecoins, including tokens designed to maintain a value linked to fiat currencies. Such transactions are often used to secure trading profits, reduce exposure to market volatility or prepare funds for another investment.

Under the proposed approach, a qualifying conversion could become a taxable disposal even if the investor never withdraws money into a bank account. That distinction matters because stablecoins have become a common tool for moving between crypto investments without returning to conventional currency.

For example, an investor who purchases Bitcoin at a lower price and later exchanges it for an eligible stablecoin could face a tax liability on the realized gain under the proposed rules. The precise calculation would depend on the applicable French tax provisions and the final legislative text.

During the debate, David Amiel, the minister responding to lawmakers, questioned whether all stablecoins should be treated as reliably stable. He warned that some tokens can experience market turmoil or lose the effectiveness of their backing arrangements.

His remarks highlight a central challenge for regulators: stablecoins may serve as cash-like instruments in crypto markets, but their structures and risks are not identical. The amendment’s focus on qualifying electronic money tokens is therefore important; it should not automatically be interpreted as covering every token marketed as a stablecoin.

The vote also comes amid wider efforts to improve the visibility of crypto transactions for tax authorities. For investors, the outcome could mean reviewing how they record acquisition costs, disposals and exchanges if the proposed changes take effect.

France weighs exit tax on crypto wealth

Stablecoin taxation is only one part of the broader debate over France’s digital-asset rules. Lawmakers are also considering a proposal to extend the country’s exit tax regime to certain unrealized cryptocurrency gains when wealthy taxpayers transfer their tax residence abroad.

Amendment I-CF1822 proposes applying the measure to taxpayers who have been French tax residents for at least six of the previous 10 years and whose household crypto holdings exceed €800,000. The proposal would cover gains that have accumulated but have not been realized through a sale or other disposal.

The threshold mirrors the value threshold used in France’s existing exit tax framework for certain securities and financial holdings. Supporters argue that extending the regime to crypto would reduce differences in treatment between traditional investments and digital assets.

The proposal also addresses crypto held directly by taxpayers, including assets stored in self-custodial wallets or held through foreign platforms. Its stated objective is to prevent investors from avoiding potential taxation on substantial unrealized gains simply by moving their tax residence overseas.

However, the amendment remains a proposal rather than an enacted rule. Its final scope, implementation and interaction with existing tax arrangements will depend on the legislative outcome.

Another measure under consideration would require individuals to declare self-custodial crypto wallets when the combined value of their holdings reaches the proposed €100,000 threshold. The initiative is intended to improve tax authorities’ visibility into assets held outside conventional custodial platforms.

For investors who control their own private keys, the proposal could introduce additional compliance responsibilities. Self-custody provides direct control over digital assets, but it does not automatically exempt holders from applicable tax-reporting obligations.

Legislative uncertainty leaves investors watching

France’s proposed reforms have advanced against a backdrop of competing views over how aggressively governments should tax and monitor digital assets. While supporters emphasize tax fairness and the prevention of evasion, investors may be concerned about additional administrative burdens and the treatment of transactions that do not generate cash proceeds.

The National Assembly also rejected a separate amendment on October 16 that would have allowed realized crypto losses to be carried forward for 10 years. The proposal received 18 votes in favor, 75 against and three abstentions, indicating that lawmakers are not uniformly supporting every proposed change to digital-asset taxation.

The immediate priority is the continued examination of the 2027 Finance Bill. Approval of an individual amendment is not equivalent to final passage of the budget, and proposals can be revised, rejected or affected by subsequent stages of the legislative process.

For the market, the direction of travel is nevertheless clear: French lawmakers are examining how digital-asset transactions, offshore relocation and privately controlled wallets fit into the country’s existing tax framework.

Investors should avoid treating the latest vote as confirmation that every proposed obligation will take effect in 2027. Instead, they should monitor the final budget legislation and any implementing guidance before changing their reporting practices or investment strategies.

If enacted, the stablecoin measure would represent a meaningful change for traders who routinely move between volatile cryptocurrencies and eligible stablecoins. The proposed exit tax and wallet-declaration requirements could also expand the compliance burden for wealthy holders and people managing their assets independently.

France’s evolving Crypto tax debate therefore extends beyond the taxation of individual transactions. It raises broader questions about how governments should balance tax collection, investor obligations and the distinctive features of digital assets as the sector becomes more integrated into mainstream finance.