France Proposes Tax on Unrealized Crypto Gains Before Assets Are Sold

WHY IT MATTERS

Normally, you only pay taxes on crypto when you sell it and lock in a profit — similar to how you would only pay taxes on a house when you actually sell it for more than you paid. What France is reportedly considering is more like being taxed because your house went up in value on paper, even though you still live in it and have not sold it. This is called taxing "unrealized gains." For crypto holders, this could mean owing money to the government during a price surge, even if they have not sold anything and do not have cash on hand to pay the tax. If adopted, this approach could influence how other countries think about crypto taxation and could affect where crypto holders choose to reside.