Within the span of 1 frenetic week, France unveiled seemingly opposing coverage tracks.
On Oct. 31, the French Nationwide Meeting adopted a first-reading modification rebranding the nation’s actual estate-only wealth tax right into a broader “tax on unproductive wealth” that now explicitly covers digital belongings.
On the identical time, the right-wing Union des droites pour la République (UDR) launched a invoice to ascertain a nationwide bitcoin reserve of roughly 420,000 BTC, aiming to carry 2% of Bitcoin’s complete provide over the subsequent seven to eight years.
One measure treats crypto holdings as idle ballast to be taxed; the opposite elevates them as nationwide reserve belongings. Taken collectively, they seize France’s conflicted however consequential stance towards crypto, caught between fiscal warning and financial ambition.
The brand new wealth tax: crypto as “unproductive” capital
Underneath the modification drafted by MoDem MP Jean-Paul Mattei and revised by Socialist MP Philippe Brun, a flat tax of 1% would apply to internet taxable wealth exceeding €2 million. Crucially, the tax base now widens to incorporate belongings historically exempt, akin to collectible automobiles, tremendous artwork, luxurious vessels, and “actifs numériques” (digital belongings), together with cryptocurrencies.
The explanatory be aware specifies that beforehand excluded “tangible movable property … digital belongings … life insurance coverage insurance policies for funds not allotted to productive funding” are actually lined underneath the “unproductive” class.
A French resident with a considerable crypto portfolio may due to this fact face an annual tax, even when they don’t promote. Critics argue that this quantities to taxing latent good points fairly than realized revenue and dangers penalizing funding in digital finance. The measure has drawn sharp backlash throughout France’s crypto business, with executives warning it can drive buying and selling desks and asset-management arms towards extra lenient jurisdictions.
The bitcoin reserve: state stacking meets sovereignty
In parallel, the UDR, led by Éric Ciotti, has tabled a “proposition de loi” establishing a public physique charged with constructing a nationwide Bitcoin reserve of 420,000 BTC.
Stories describe a blueprint involving state-funded mining, the acquisition of seized cash, and an choice to pay taxes in crypto. The invoice presents Bitcoin as a strategic asset that hyperlinks power, financial independence, and digital infrastructure. Its authors invoke the language of sovereignty, portraying Bitcoin as “digital gold” that may fortify nationwide reserves in an period of de-dollarisation.
Though the proposal faces lengthy odds in a fragmented parliament, it displays a rising development inside Europe’s right-leaning events that views bitcoin not as hypothesis however as a type of statecraft.
What’s much less mentioned is how far the textual content goes in sketching the mechanics of accumulation. The invoice instructs the newly created public entity, Réserve stratégique de bitcoins, to accumulate 2% of the overall Bitcoin provide (roughly 420,000 BTC) inside seven to eight years, and to take action with out incurring any direct price to the state funds.
It lists potential funding channels akin to mining with state-owned surplus electrical energy, transferring confiscated crypto from judicial proceedings, and even reallocating dormant public deposits like these within the Livret A financial savings scheme.
The proposal would additionally authorize French residents to pay sure taxes in Bitcoin and introduce a €200-per-day exemption for euro-stablecoin funds, embedding crypto use at each the treasury and retail degree. These particulars point out that the invoice’s ambition extends far past symbolism, because it envisions Bitcoin built-in into France’s fiscal and financial structure, from power monetization to on a regular basis funds.
At first look, the 2 initiatives look like in battle, with one penalizing non-public crypto accumulation and the opposite encouraging public hoarding. Legally, nonetheless, they will coexist.
The wealth-tax modification targets particular person steadiness sheets, whereas the reserve invoice considerations the state’s. Public holdings would possible be exempt from the tax regime, leaving non-public holders to bear annual valuation and reporting duties. In observe, the strain would floor via market results.
Taxing crypto holdings raises the price of non-public accumulation and will shrink home provide, which in flip raises acquisition prices for the reserve. Conversely, aggressive state accumulation would tighten liquidity and inflate the taxable base for personal traders, forcing the federal government to navigate the suggestions loop it created.
Between coverage paradox and precedent
France’s method locations it on the crossroads of two world fashions. Wealth-based taxation of crypto already exists in Switzerland, Spain, and Norway, the place digital belongings are declared and valued yearly. These programs tax the inventory of wealth, not realized good points, and France’s new framework follows that lineage.
In distinction, the thought of a sovereign Bitcoin reserve situates Paris alongside experiments like El Salvador’s, although filtered via a European lens of institutional administration fairly than presidential decree.
Business response in France has been swift and unflattering. Begin-ups and exchanges warn that the modification treats crypto as ornamental wealth fairly than working capital, equating it with yachts and watches. Annual mark-to-market obligations, they are saying, create liquidity pressure and valuation uncertainty.
In terms of policymakers, the counterargument rests on precedent: wealth taxes have lengthy focused unproductive capital, and fashionable tax regulation already applies mark-to-market accounting to some monetary devices.
Business response in France has been swift and unflattering. Begin-ups and exchanges warn that the modification treats crypto as ornamental wealth fairly than working capital, equating it with yachts and watches. Annual mark-to-market obligations, they are saying, create liquidity pressure and valuation uncertainty.
Politically, the distinction is simply as sharp. The wealth tax modification superior with an uncommon coalition of centrists, socialists, and far-right deputies. On the identical time, the UDR reserve invoice originates from a small conservative bloc with little parliamentary leverage.
If solely the tax passes, France will tighten its grip on non-public holdings whereas shelving the reserve dream. If each advance, the end result could be paradoxical: non-public crypto handled as taxable luxurious, state-held Bitcoin elevated to sovereign wealth. Every may perform independently, but collectively they might change how France values and controls digital belongings.
For now, each proposals stay in flux. The wealth-tax textual content heads to the Senate, the place lawmakers could refine the definition of “actifs numériques” or introduce carve-outs for productive use. The Bitcoin reserve invoice awaits committee referral and debate.
No matter their legislative destiny, they’ve already set the tone for France’s subsequent chapter in digital finance: a nation able to tax crypto like artwork whereas considering stacking it like gold.
