New Regulatory Amendments Proposed in France

Recent proposals by the French finance committee aim to enhance the regulation of cryptocurrency assets within the country. Among the amendments is a requirement that mandates taxpayers to declare self-hosted crypto wallets holding assets exceeding €100,000 (approximately $116,000), with penalties of up to $11,600 for non-compliance.

Concerns Raised by Industry Leaders

Francois Volpoet, CEO of Chainalysis in France, expressed significant concerns regarding these measures. In a correspondence with CoinDesk, he questioned, “Do we want more taxpayers to declare their assets, or a higher tax rate applied to a base that is increasingly evaded?” He highlighted the challenges that authorities face in monitoring transactions conducted via decentralized finance (DeFi) platforms and self-hosted wallets, compared to the oversight available for regulated stablecoin transactions.

Cybersecurity Concerns Linked to Asset Disclosure

Volpoet also pointed to an increase in physical attacks targeting crypto holders in France, raising alarm over the security implications of asset disclosures. According to reports, Europe has seen 39 of the 52 global incidents related to assaults on cryptocurrency holders, with France accounting for 33, or about 63.5%, of these occurrences as of July.

Taxation Measures for Crypto Assets

In addition to the disclosure requirements, lawmakers have supported an amendment to extend France’s exit tax to cover crypto assets valued at approximately $900,000. This measure aligns unrealized cryptocurrency gains with the tax protocols currently applicable to affluent shareholders relocating abroad.

Further, an amendment approved on October 7 allows investors to carry forward crypto losses for a period of up to 10 years, thereby aligning the tax treatment of cryptocurrencies more closely with that of traditional stock investments.