France Backs Proposal to Tax Crypto-to-Stablecoin Swaps at 31.4% From 2027

France’s National Assembly has backed a measure that would bring certain crypto-to-stablecoin swaps into the country’s capital-gains tax regime from January 1, 2027. The margin was 38 votes to 37, however, and amendment I-3898 remains part of an unfinished budget process rather than final law.

The proposed rate is not new. Private investors already face France’s 31.4% flat tax on taxable crypto gains: 12.8% income tax and 18.6% social levies. What changes is the point at which a gain may be treated as taxable. Under current rules, many crypto-to-crypto exchanges without additional cash consideration benefit from tax deferral. The amendment would carve regulated fiat-backed stablecoins out of that treatment.

That is a narrower intervention than a headline suggesting a new tax on all crypto trading. It is also potentially consequential. Stablecoins are often the asset into which investors move after gains, and France’s proposed classification would treat that move less like a portfolio reshuffle and more like an exit into a usable monetary instrument.

The 31.4% charge targets stablecoin swaps

The amendment concerns exchanges where a taxpayer receives electronic-money tokens as defined under the EU’s Markets in Crypto-Assets regulation, or MiCA. In practice, that category covers regulated fiat-backed stablecoins. The existing deferral available for qualifying crypto-to-crypto exchanges would no longer apply in those cases, according to the text of the amendment.

Crucially, the proposal is directed at the gain embedded in the crypto asset surrendered, not at the gross amount of every stablecoin swap. The calculation would use the acquisition cost of the crypto assets sold, applying a weighted-average method for units of the same asset. An investor exchanging an asset that has not appreciated would therefore not face a comparable capital-gains liability merely because the destination asset is a stablecoin.

The distinction matters because it separates a realization rule from a transaction tax. A holder moving appreciated crypto into a qualifying stablecoin could crystallise a taxable gain; the same holder retaining the asset, or making a crypto-to-crypto exchange that remains within the current deferral framework, would be treated differently. France’s tax administration describes the present private-investor regime as applying the 31.4% PFU to taxable disposals while generally deferring qualifying crypto-to-crypto exchanges.

The measure consequently changes the timing of taxation, which can be as important to investors as the rate itself. It would require a taxpayer to account for the acquisition history of assets used to obtain stablecoins, rather than waiting until a later conversion into conventional currency or another clearly taxable disposal.

Stablecoins as an economic exit

The legislative logic rests on what a fiat-backed stablecoin represents after a crypto gain has been made. Supporters of the amendment called the present treatment a loophole: an investor can convert appreciated crypto into a stablecoin without triggering the tax that would apply on a direct conversion into euros.

The explanatory statement goes further than describing stablecoins as short-term trading tools. It argues that they can perform investment and payment functions. That framing is central to the proposal. If a regulated electronic-money token can be held as a relatively stable store of value and used for payments, lawmakers can argue that receiving it is economically closer to realizing a gain than exchanging one volatile crypto asset for another.

There is an important boundary in that approach. The amendment does not appear to recast every digital-asset swap as a taxable event. It singles out a MiCA-based category of token. The tax outcome would therefore turn not simply on whether an investor has left bitcoin, ether or another crypto asset, but on whether the asset received falls within the electronic-money-token definition.

That legal distinction may look technical, but it is where the policy’s incentives reside. The proposal makes a particular route out of appreciated crypto more expensive at the time it is used, while leaving other routes subject to different treatment under the wider rules.

A rule shaped by dollar liquidity

Although the policy is being advanced in France, its practical focus is unlikely to be confined to euro-denominated digital money. The Banque de France reported that roughly 99% of stablecoins in circulation were pegged to the US dollar as of December 31, 2025. The stablecoin market that French users are most likely to encounter is therefore overwhelmingly dollar-based.

That creates a tension between the domestic tax rationale and market structure. The amendment’s advocates focus on avoiding a tax-free detour around a sale into euros. Yet the rule could chiefly affect investors rotating into dollar-pegged tokens, because those assets dominate stablecoin circulation. It is not merely a rule about converting crypto into a digitised version of France’s or the euro area’s own currency.

The amendment’s scope is nonetheless tied to regulatory classification, not to a token’s currency peg alone. A dollar-linked stablecoin would matter for the proposed rule if it meets the relevant MiCA electronic-money-token definition. This makes the legal perimeter more significant than broad labels such as “stablecoin,” which can encompass a variety of designs and regulatory statuses.

For market participants, the result is a tax distinction built around an asset class whose liquidity and usage are globally oriented. France can determine the tax treatment of residents within its jurisdiction, but the instruments at issue are typically used across venues and networks that do not map neatly onto a national market.

The revenue case depends on behaviour

Proponents cited €1.5 billion in potential fiscal revenue. That number should be read as a political estimate, not an independently verified budget forecast. Its eventual accuracy would depend on taxable gains, the extent to which eligible swaps occur, compliance and, above all, how investors respond to the change.

The response mechanism is unusually direct. If converting into a qualifying stablecoin triggers tax on accrued gains, some users may prefer to defer that conversion, use decentralised finance, arrange peer-to-peer transfers, trade through offshore venues or move into assets outside the amendment’s MiCA-based definition. Those possibilities do not establish that such shifts will occur at scale. They do show why a static estimate of taxable stablecoin activity may not translate cleanly into receipts.

There is also a practical distinction between changing investor behaviour and changing what authorities can observe. A rule that taxes a clearly identifiable exchange on a compliant platform may be easier to administer than one involving multiple transfers or alternative routes through the broader crypto market. The proposal’s fiscal promise and its enforcement design cannot be separated.

In that sense, the €1.5 billion figure is not only a claim about gains already sitting in the system. It assumes a degree of continued visibility and continued use of the transaction path that the amendment would make less attractive.

A one-vote amendment with open questions

The narrow Assembly vote is more than a procedural footnote. Amendment I-3898 passed by one vote on October 16, 2026, and remains subject to the rest of the budget process before it could take effect on the proposed January 1, 2027 date. It should not yet be treated as settled French tax law.

Questions raised during the debate go to the heart of whether the rule can operate as intended. France’s public-accounts minister questioned whether stablecoins were sufficiently defined and whether authorities could monitor reallocations within crypto portfolios, according to CoinDesk’s report on the vote. Those concerns sit alongside the amendment’s own reliance on a MiCA-linked category and its weighted-average gain calculation.

A statutory definition can establish the starting point for a tax rule, but it does not by itself resolve the evidentiary task of identifying transactions, reconstructing acquisition costs, or distinguishing qualifying tokens from assets outside the rule. If the tax case depends on stablecoins functioning as an effective economic exit, establishing when and how that exit occurred becomes more important.

France has therefore advanced a clear policy proposition but not yet a finished tax regime: gains moving into regulated fiat-backed stablecoins should no longer receive the deferral available to other qualifying crypto exchanges. Whether that proposition survives the budget process, and whether it can be monitored across the market it seeks to reach, remains unresolved.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.