French lawmakers are considering a change that would treat certain conversions of cryptocurrencies into regulated stablecoins as taxable events beginning in 2027. The proposal forms part of broader amendments to the country’s 2027 budget and remains subject to further parliamentary debate.

Proposed Tax on Qualifying Stablecoin Conversions

The National Assembly’s finance committee adopted an amendment on October 7 that would apply France’s existing 31.4 percent flat capital gains rate to exchanges of bitcoin and other crypto assets into stablecoins classified as electronic money tokens under the European Union’s Markets in Crypto-Assets regulation. The measure, if enacted, would take effect on January 1, 2027.

Under current rules, investors generally do not face capital gains tax when swapping one crypto asset for another. Tax liability arises mainly when holdings are sold for fiat currency or spent. The amendment would end that deferral for conversions into the specified category of regulated tokens.

The proposal targets electronic money tokens covered by MiCA, which entered full force on July 1, 2026. According to industry analysis, tokens such as USDT, DAI and PAXG would fall outside the measure’s scope.

Industry Caution on Potential Market Response

Francois Volpoet, Chainalysis’s chief executive for France, cautioned that the tax could encourage traders to move activity toward decentralized finance platforms, peer-to-peer transactions, offshore exchanges or stablecoins outside the regulated category. He noted that authorities find regulated stablecoin transactions easier to monitor than activity involving self-hosted wallets or venues beyond international reporting arrangements.

Chainalysis estimates that France recorded $9.4 billion in taxable on-chain crypto activity during 2025, including $2.5 billion in gains. Volpoet pointed to sharp shifts in European trading volumes after earlier regulatory changes as an illustration of how activity can migrate.

Additional Reporting and Tax Measures

A separate amendment backed on October 9 would require French taxpayers to disclose self-hosted wallets holding at least $116,000 in assets at year-end. Non-compliance would carry fines of up to $11,600. Sponsors cited a gap between recorded crypto gains and amounts declared to tax authorities.

Lawmakers also supported extending France’s exit tax to crypto holdings valued at roughly $900,000. The change would apply unrealized gains rules already used for certain wealthy shareholders who relocate abroad. Another measure would allow investors to carry crypto losses forward for up to 10 years, aligning treatment more closely with stock losses.

Security concerns have been raised around mandatory disclosure of large holdings. Chainalysis data show France accounted for a significant share of recorded crypto-related physical attacks in the first half of 2026, with relatives of holders targeted in a substantial portion of incidents.

Legislative Path Remains Open

None of the crypto-related amendments has become law. The finance committee rejected the revenue section of the 2027 budget by 31 votes to 3, requiring the measures to be resubmitted for consideration by the full National Assembly. A vote on the revenue section is scheduled for October 20. Parliament has until December 10 to pass the budget.

The amendments were introduced during discussions on the 2027 finance bill. Supporters argue that stablecoin conversions currently allow investors to lock in gains without triggering the tax that applies to fiat sales. The proposals continue to face further debate and possible revision.