France Drops Self-Custody Reporting Mandate

Key Takeaways:

• The French National Assembly axed an article requiring users to report self-custody crypto wallets over €5,000.

• Adan celebrated this win, which protects users in France, a nation suffering 40% of Europe’s wrench attacks.

• Scrapping the €5,000 reporting rule avoids future attacks fueled by leaked tax data, notes Telegram’s CEO.

French National Assembly Drops Self-Custody Funds Disclosure From Upcoming Fraud Law

The French National Assembly has made a decisive move to protect the data of French crypto holders by dropping a controversial requirement from a law project.

According to reports from Adan, a French organization that drives adoption and innovation in the cryptocurrency sector, the article that established a duty to report the contents of cryptocurrency portfolios over €5,000 held under self-custody to the DGFIP, the French tax watchdog, was removed from a law project against fraud in the last stages of the draft revision.

The move, considered a victory for the French cryptocurrency sector, comes after a heated debate as Deputy Daniel Labaronne proposed a motion to suppress the article, which failed. Labaronne argued that it would not be feasible for the agency to check the veracity of the information provided by taxpayers.

Adan celebrated this outcome, stressing that they had been taking action since last November to defend their position before administrative bodies, government offices, and deputies, explaining that they supported strengthening the fight against fraud but were against creating an unworkable and risky obligation for taxpayers.

The organization referred to the risks that French cryptocurrency holders face, as the country has become a hotbed for so-called “wrench attacks,” including violence as a means to force cryptocurrency holders to deliver their holdings to these attackers.

High-profile industry figures, including Binance’s head in the country and Ledger co-founder David Balland, have been targeted, as France accounts for nearly 40% of these attacks across Europe.

Pavel Durov, founder and CEO of Telegram, directly linked the rise in these attacks to French officials selling data of crypto owners to criminals and massive tax database leaks, warning against the risks of giving the French government even more information about cryptocurrency holders than it already has.