Tax Regulation

France’s National Assembly Finance Committee has voted to treat stablecoin swaps as taxable events even before cash withdrawal, closing what lawmakers describe as a legislative loophole that allowed crypto-to-fiat-backed stablecoin conversions to escape capital gains tax. The change would apply from January 1, 2027, and forces crypto investors holding positions across multiple assets to choose an irrevocable valuation method for pre-2027 holdings.

• Amendment I-CF1826, adopted October 7, removes tax deferral on crypto-to-crypto swaps when the received asset is an e-money token defined under EU Markets in Crypto-Assets regulation, including USDC.
• Investors with pre-2027 holdings can elect either actual historical acquisition costs or a Dec. 31, 2026 portfolio allocation method, with the choice binding irrevocably for the entire portfolio.
• The same Bitcoin gain can produce different taxable results depending on which transition method is chosen, and losses realized in earlier years will not offset gains in later years under existing French loss-restriction rules.

• Jan. 1, 2027 Effective date for new swap taxability and acquisition cost calculation rules
• €60,000 Bitcoin value in hypothetical example producing different gains under each transition method
• Oct. 13 Scheduled National Assembly plenary debate on 2027 budget dossier containing amendment

The adopted amendment to France’s 2027 finance bill targets crypto-to-stablecoin conversions by removing a tax deferral that currently applies to most crypto-to-crypto exchanges. Under existing rules, swapping Bitcoin for another crypto asset, including stablecoins, does not trigger an immediate capital gains tax event if no fiat currency or goods change hands. The Finance Committee’s amendment closes that deferral specifically when the received asset is an e-money token under the EU’s MiCA regulation, which covers stablecoins like USDC that maintain stable value by reference to a single official currency. The amendment’s sponsors justify the change as plugging what they call a loophole: stablecoin swaps function as investment vehicles and can be used to purchase other assets or pay on crypto payment networks, yet they escape the flat tax that would apply if the investor had converted directly to euros.

USDC swaps become taxable events while proceeds remain in crypto accounts

For a crypto holder looking to reduce market exposure, the practical effect is immediate tax recognition of unrealized gains without any requirement to convert to fiat currency. A Bitcoin holder who swaps €60,000 worth of Bitcoin into native USDC to hedge portfolio risk would recognize whatever capital gain exists at that moment, even if the USDC sits in a wallet or exchange account indefinitely.

Under current law, that same swap would receive tax deferral; the gain would become taxable only when the investor later converted the USDC to euros or used it to purchase goods or services.

The amendment applies France’s standard capital gains regime, which taxes securities disposals at a flat rate of 12.8 percent or under progressive income tax brackets with holding-period deductions. Crypto gains and losses must currently offset within the same tax year, and net losses cannot carry forward to later years or reduce gains on other assets. The new rule does not change that loss restriction, creating an asymmetry: an investor who recognizes a loss by swapping into a stablecoin in one year cannot use that loss to shelter gains realized in future years if the holding is later disposed of at a profit.

Two transition paths produce materially different tax liabilities depending on historical cost allocation

The amendment’s most complex element gives investors with pre-2027 holdings two mutually exclusive options for calculating acquisition costs going forward. Method one uses actual historical acquisition prices, verified by documentation, applied to each asset individually.

Method two calculates the total acquisition cost of the entire crypto portfolio as of December 31, 2026 under current rules, then allocates that lump sum among holdings in proportion to their market values on that date. An investor must choose one method when filing the first tax return reporting a taxable disposal after January 1, 2027, and that choice binds the entire portfolio irrevocably.

Consider an investor holding Bitcoin purchased for €20,000 (now worth €60,000) and Ether purchased for €40,000 (now worth €40,000). The total portfolio cost is €60,000 and total value is €100,000. Using the allocation method, Bitcoin represents 60 percent of portfolio value and receives €36,000 of basis, while Ether receives €24,000.

A subsequent Bitcoin-to-USDC swap at €60,000 would recognize a €24,000 gain under allocation but only €40,000 under actual cost. The same swap would trigger a €0 gain on the remaining Ether sale for €40,000 under actual cost but a €16,000 gain under allocation. Which method produces higher aggregate tax depends entirely on which assets appreciated most relative to their original purchase price.

The amendment specifies that crypto received in a taxable swap receives basis equal to the proceeds used to calculate the gain, preventing double taxation when those assets are later sold.

But it leaves open whether investors can engineer basis advantages by timing swaps across different tax years or by choosing which holding to dispose of first when multiple pools of the same token exist with different costs.

Plenary vote on October 13 will determine whether amendment advances to final legislative stage

The Finance Committee’s adoption is not final passage. The National Assembly’s full legislative body is scheduled to debate the 2027 budget dossier on Tuesday, October 13 (2026), which includes this amendment. Passage would still require Senate approval and presidential signature before the January 1, 2027 effective date takes effect.

The amendment’s sponsors noted that the United Kingdom and Italy have already enacted similar rules treating stablecoins as currency for tax purposes, suggesting a broader European trend toward eliminating the swap deferral.

One material question remains unresolved: whether the amendment’s focus on the “asset received” means that swaps into non-compliant or unregistered stablecoins, or into euro-backed tokens other than USDC, would retain deferral despite functioning identically to MiCA-compliant e-money tokens.

The text does not distinguish by issuer compliance status, only by the regulatory classification of the token itself.

The CCS read. Institutional crypto traders and wealth managers operating in France face a material shift in hedging economics. Swapping into stablecoins no longer defers tax, it crystallizes gain immediately. That changes the cost-benefit of using stablecoins for duration management or drawdown sequencing. Investors holding diversified crypto portfolios acquired at vastly different costs should model both transition methods before filing their first 2027 return, as the choice affects not just the current year but all future disposals from that portfolio.

The National Assembly plenary is scheduled to debate the 2027 budget dossier, which includes this amendment, on Tuesday, October 13. If the full chamber passes it, the text then moves to the Senate for its own committee and floor review before any final presidential signature. Amendment sponsors have indicated they view this as a revenue-neutral enforcement of existing tax principles rather than a new tax, but the Senate’s position remains unknown.