France is considering a proposal to extend its 31.4% crypto capital gains tax to transactions involving EU-regulated stablecoins. Chainalysis France CEO Francois Volpoet warned that the move could push investors toward offshore exchanges and trading channels that are harder for authorities to monitor.

The proposal is part of France’s 2027 budget, which lawmakers began debating in the National Assembly last week. The deadline for approving the budget is Dec. 10.

On Oct. 7, the National Assembly’s finance committee approved an amendment that would make swaps from cryptocurrencies such as Bitcoin into certain stablecoins subject to taxation. The measure 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, exchanging one cryptocurrency for another generally does not trigger capital gains tax. The existing 31.4% flat rate usually applies when investors convert crypto into fiat currency or use their holdings to make payments.

If the proposal becomes law, swaps into qualifying EU-regulated stablecoins would become taxable from Jan. 1, 2027. Since the amendment targets a specific category of stablecoins, some traders may consider alternatives that fall outside its scope.

Chainalysis warns of an 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.

Speaking to CoinDesk by email, Volpoet questioned whether increasing the tax burden would be more effective than encouraging taxpayers to declare their holdings and report their activity.

He argued that transactions involving regulated stablecoins are easier for authorities to track than activity conducted through decentralized finance (DeFi) platforms or self-hosted wallets.

According to Volpoet, the proposed changes could encourage investors to use DeFi services, peer-to-peer trading and exchanges operating outside international tax-reporting arrangements.

He also highlighted a potential gap in the proposal, which targets MiCA-compliant stablecoins but excludes other tokens, including USDT, DAI and PAXG.

Chainalysis estimates that France recorded $9.4 billion in taxable onchain cryptocurrency activity in 2025, including $2.5 billion in gains. Volpoet noted that these figures do not indicate how much trading could shift if the proposed tax is introduced.

He also cited differences in European trading growth for EURC and USDC. Between July 2024 and June 2025, EURC trading volumes surged 2,727%, while USDC volumes rose 86%. He pointed to the figures as an example of how regulatory conditions can influence trading activity.

Proposed wallet disclosures spark security concerns

A separate amendment supported by the finance committee on Oct. 9 would require French taxpayers to declare self-hosted crypto wallets containing at least €100,000 in assets, equivalent to approximately $116,000. Failure to comply could result in fines of up to $11,600.

Volpoet expressed concern about the security implications of collecting information about large cryptocurrency holdings, particularly as physical attacks targeting crypto owners have increased in France.

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

Chainalysis documented 30 violent attacks in France during the first half of 2026, Volpoet said. More than 40% of these incidents reportedly targeted relatives of crypto holders rather than the investors themselves.