A proposed measure would require disclosure of self-custody holdings above roughly €100,000, with fines reaching €10,000 for non-compliance.
French lawmakers have voted to support a new reporting requirement aimed at crypto holders with large self-custody balances. The rule would apply to wallets holding more than approximately €100,000, equivalent to roughly $112,000 at current exchange rates.
Under the proposal, individuals who fail to disclose qualifying holdings could face fines of up to €10,000. The measure specifically targets self-custody crypto, meaning assets held outside of exchanges or regulated custodians where the holder controls the private keys directly.
Self-custody has long sat in a regulatory gray zone across much of Europe. Centralized exchanges already report customer holdings to tax authorities in many jurisdictions. Wallets controlled directly by individuals, without an intermediary, have been far harder for governments to track or tax effectively.
The French proposal appears designed to close that gap. By requiring disclosure above a set threshold, authorities would gain visibility into large holdings that currently fall outside standard reporting channels. Supporters of such rules generally argue they improve tax compliance and reduce the use of crypto for undeclared wealth.
Critics of similar proposals elsewhere have raised concerns about privacy and the practicality of enforcement. Self-custody wallets are, by design, difficult to monitor without voluntary disclosure or external tracing tools. Verifying compliance would likely require cooperation from taxpayers themselves, supplemented by blockchain analysis where authorities deem it necessary.
France has been an active participant in European Union discussions over crypto regulation, including the bloc's Markets in Crypto-Assets framework. That regulation primarily governs service providers such as exchanges and custodians, rather than individual wallet holders. A domestic reporting rule for self-custody assets would extend French oversight beyond what MiCA currently covers at the EU level.
The measure still needs to move through further legislative steps before becoming law. Lawmakers' backing represents an early but significant stage in that process, signaling political appetite for tighter oversight of unhosted wallets. The exact mechanics of reporting, including whether disclosure would be annual or tied to specific transactions, have not been detailed in available reporting.
France's approach could serve as a reference point for other EU member states weighing similar rules. Tax authorities across the bloc have increasingly focused on crypto wealth as holdings have grown and diversified beyond exchange accounts.
Market Impact
A reporting mandate of this kind would primarily affect individual holders in France with substantial self-custody balances, rather than exchanges or trading platforms directly. It could influence how large holders in France choose to store assets, potentially shifting some balances toward custodial services that already handle reporting obligations.
More broadly, the proposal adds to a pattern of European governments seeking greater visibility into crypto wealth held outside regulated intermediaries. If enacted, it may prompt discussion in other EU states about whether similar wallet-disclosure thresholds should be adopted, particularly as MiCA implementation continues across the bloc.
The proposal remains in an early legislative stage, but its backing by French lawmakers signals growing government interest in bringing self-custody crypto under stricter tax and reporting oversight.
Frequently Asked Questions
What wallet balance would trigger the reporting requirement?
The proposal applies to crypto wallets holding more than approximately €100,000, or about $112,000 at current exchange rates.
What penalty would apply for failing to disclose a qualifying wallet?
Reports indicate fines of up to €10,000 for individuals who do not disclose holdings above the threshold.
Does this rule apply to crypto held on exchanges?
The measure is aimed at self-custody holdings, where individuals control their own private keys, rather than assets held through exchanges or custodians.
Has the proposal become law?
French lawmakers have backed the measure, but it still needs to proceed through further legislative steps before taking effect.
