France’s Planned 31.4% Tax on Stablecoins Sparks Concerns Over Trader Flight

France is weighing a proposal to extend its 31.4% cryptocurrency capital gains tax to swaps involving EU-regulated stablecoins. Chainalysis France CEO Francois Volpoet cautioned that the plan could drive traders toward offshore exchanges and less transparent trading channels.

The measure forms part of France’s 2027 budget, which lawmakers began debating in the National Assembly last week. The government’s deadline for securing approval is Dec. 10.

On Oct. 7, the Assembly’s finance committee approved an amendment that would make exchanging cryptocurrencies such as Bitcoin for certain stablecoins a taxable event. The proposal covers electronic money tokens regulated under the European Union’s Markets in Crypto-Assets (MiCA) framework, which became fully applicable on July 1.

Under current French rules, swapping one cryptocurrency for another generally does not trigger capital gains tax. The existing 31.4% flat rate typically applies when investors convert their holdings into fiat currency or spend their crypto.

If approved, the amendment would make swaps into qualifying EU-regulated stablecoins taxable from Jan. 1, 2027. Because the proposal targets a specific category of tokens, it could encourage investors to consider stablecoins that fall outside the rules.

Chainalysis warns of a potential offshore shift

Francois Volpoet, Chainalysis’ CEO for France, said the proposed tax could undermine efforts to bring more cryptocurrency transactions into the regulated financial system.

In comments sent to CoinDesk, Volpoet questioned whether raising taxes would be more effective than encouraging investors to declare their assets and report their transactions.

He argued that authorities can more easily monitor transfers involving regulated stablecoins than activity conducted through decentralized finance (DeFi) platforms or self-hosted wallets.

Volpoet warned that traders could respond by turning to DeFi services, peer-to-peer transactions and exchanges operating outside international tax-reporting frameworks.

He also highlighted the proposal’s limited scope. While it targets MiCA-compliant stablecoins, other tokens, including USDT, DAI and PAXG, would remain outside the proposed tax rules.

Chainalysis estimates that France recorded $9.4 billion in taxable onchain cryptocurrency activity during 2025, including $2.5 billion in gains. Volpoet said these figures do not reveal how much trading activity could move elsewhere if the amendment takes effect.

He also pointed to differences in European trading growth between EURC and USDC. From July 2024 to June 2025, EURC trading volumes climbed 2,727%, compared with an 86% increase for USDC. He cited the figures as an example of how regulatory changes can influence market activity.

Wallet reporting proposal raises safety concerns

Another amendment backed by the finance committee on Oct. 9 would require French taxpayers to disclose self-hosted cryptocurrency wallets containing at least €100,000 in assets, worth approximately $116,000. Failure to comply could lead to fines of up to $11,600.

Volpoet raised concerns about the security risks associated with collecting information about substantial crypto holdings, particularly amid an increase in physical attacks targeting cryptocurrency owners in France.

By July, Europe had recorded 39 of the 52 reported incidents worldwide. France accounted for 33 cases, representing 63.5% of the global total.

Chainalysis recorded 30 violent attacks in France during the first half of 2026, Volpoet said. More than 40% of those incidents reportedly involved attacks against relatives of cryptocurrency holders rather than the holders themselves.

He warned that mandatory disclosures could put investors’ families at risk if confidential information were leaked. Volpoet called for strict controls over who can access the reported data.

Additional crypto tax proposals

French lawmakers have also supported a proposal to extend the country’s exit tax to cryptocurrency holdings worth approximately $900,000. The measure would bring unrealized crypto gains under rules already applied to wealthy shareholders who move abroad.

A separate amendment approved by the finance committee on Oct. 7 would allow investors to carry forward cryptocurrency losses for up to 10 years, bringing their treatment closer to that of stock-market losses.

However, the finance committee subsequently rejected the revenue section of the government’s 2027 budget by 31 votes to three. The cryptocurrency amendments must therefore be resubmitted during debate in the full National Assembly.

Lawmakers are scheduled to vote on the revenue section on Oct. 20. None of the proposed measures has become law.

Greece considers a lower cryptocurrency tax

France’s plans contrast with developments in Greece, where a draft bill published for public consultation last week proposes a 10% capital gains tax on cryptocurrency profits.

If adopted, the rate would place Greece among EU countries with relatively low taxes on crypto gains. France, Germany and Italy, by comparison, apply or are considering rates above 25%.

The differing approaches highlight the challenge facing European policymakers as they seek to collect tax revenue and strengthen oversight without pushing cryptocurrency trading toward markets that are harder to monitor.