France’s Controversial Crypto Tax: Will Bitcoin Become a "Non-Productive Wealth" Like Yachts in 2025?

• What Exactly Did the French Parliament Vote On?
• Why Is the French Crypto Industry Up in Arms?
• The Political Odd Couple Behind the Vote
• What Happens Next for French Crypto Holders?
• Could This Become a European Trend?
• Practical Challenges of Enforcement
• Historical Context: France's Love-Hate Relationship With Wealth Taxes
• Industry Reactions and Potential Legal Challenges
• FAQ: France's Proposed Crypto Wealth Tax

France's National Assembly has sparked a firestorm in the crypto community by voting to classify digital assets as "non-productive wealth" subject to annual taxation. This move, which places bitcoin alongside luxury yachts and gold bullion in fiscal terms, could force French crypto holders with portfolios exceeding €2 million to pay 1% annual tax - even without selling their assets. The controversial amendment, passed by a narrow 163-150 vote, now faces Senate approval before potentially taking effect in early 2026.

What Exactly Did the French Parliament Vote On?

Last Friday witnessed a watershed moment in France's financial policy when lawmakers approved an amendment to tax cryptocurrencies as "dormant wealth." Proposed by centrist MP Jean-Paul Matteï, the measure targets assets deemed economically "unproductive" - a category that already includes art collections, vintage cars, and precious metals. The 1% flat tax would only apply to crypto holdings above €2 million, significantly lower than the progressive rates applied to real estate. What makes this particularly controversial is that it taxes asset ownership rather than profits - a first for crypto in France. An investor holding €3 million in Bitcoin would owe €10,000 annually, regardless of market performance.

Why Is the French Crypto Industry Up in Arms?

Éric Larchevêque, co-founder of French crypto wallet leader Ledger, blasted the decision as "ideological error" on social media. "This penalizes savers who want to store value outside the fiat system," he argued. Industry concerns focus on three main issues: forced liquidations (many investors lack cash to pay taxes without selling crypto), potential threshold creep (the €2M limit could be lowered later), and technical enforcement challenges. How will authorities value decentralized wallet holdings? Can they verify declarations without massive bureaucracy? These unanswered questions could make implementation messy.

The Political Odd Couple Behind the Vote

In a rare alliance, socialist and far-right lawmakers joined forces to pass the amendment, revealing cross-spectrum skepticism toward digital assets. The timing seems particularly awkward - just days after another parliamentary group proposed creating a national Bitcoin reserve of 420,000 BTC. This contradiction highlights France's political divide on crypto: some see it as strategic asset, others as speculative burden. As BTCC market analyst David Chen notes, "France risks sending mixed signals while competitors like the U.S. embrace crypto innovation."

What Happens Next for French Crypto Holders?

The amendment still requires Senate approval and inclusion in the 2026 budget. If passed, France WOULD join a small group of nations taxing crypto holdings rather than just transactions. Market analysts at TradingView suggest this could trigger short-term sell pressure as whales prepare for tax liabilities. However, long-term impacts remain uncertain - similar wealth taxes in other sectors have sometimes driven capital flight rather than increased revenue.

Could This Become a European Trend?

France's MOVE comes as EU policymakers debate the Crypto-Asset Reporting Framework (CARF), which would automate tax information sharing between member states. Some experts fear the French model could inspire similar "dormant wealth" taxes elsewhere in Europe. "Once one major economy breaks the taboo, others may follow," warns a CoinMarketCap regulatory analyst. This creates particular anxiety for crypto investors using France as an EU base.

Practical Challenges of Enforcement

The amendment raises numerous implementation questions: How will tax authorities value volatile assets? What about decentralized finance (DeFi) positions? Can hardware wallet holdings be verified? Without clear answers, the law might disproportionately target exchange-held crypto while sophisticated investors find loopholes. As one Paris-based crypto accountant joked, "We may need to invent a new accounting standard - GAAP for the anarcho-capitalists."

Historical Context: France's Love-Hate Relationship With Wealth Taxes

This isn't France's first controversial wealth tax. The Impôt de Solidarité sur la Fortune (ISF) on high-value assets was reformed in 2018 after critics blamed it for driving away billionaires like Bernard Arnault. The new crypto tax appears designed to avoid those mistakes by setting a high threshold and low rate. Whether it balances fairness and practicality remains to be seen.

Industry Reactions and Potential Legal Challenges

French crypto associations are considering constitutional challenges, arguing the tax violates property rights. Meanwhile, some investors explore legal structures to mitigate exposure. "In my experience, such abrupt fiscal changes often create more loopholes than revenue," comments a Geneva-based wealth manager serving French clients. The coming months will reveal whether this becomes a model for crypto taxation or a cautionary tale.

FAQ: France's Proposed Crypto Wealth Tax

When would the new crypto tax take effect?

If approved by the Senate, the tax would apply starting January 2026.

How is this different from existing crypto taxes in France?

Currently, France only taxes crypto capital gains upon sale. The new law would tax holdings annually regardless of transactions.

What counts as "non-productive" crypto wealth?

The amendment broadly defines this as cryptocurrencies held without active business use, similar to collectibles or precious metals.

Can the €2 million threshold change?

Yes, future governments could adjust the amount through normal legislative processes.

How might this affect crypto prices?

Short-term sell pressure is possible as large holders rebalance, but long-term market impact remains uncertain.