The Ministry of Finance in Germany has drafted a bill to tax gains on cryptos by 25% from 2028. This, according to a document seen by local media Die Welt on Wednesday. A major change for a country which until now completely exempted crypto gains held for more than twelve months. At the same time, thousands of kilometers away, Block, Jack Dorsey’s company, filed an application for a federal banking charter with the American authorities to custodian bitcoin and stablecoins. Two countries, two radically different ways of bringing crypto into common law.
In brief
- Germany is set to end one of the most favorable crypto tax regimes in Europe.
- The change in tax regime in Germany will not apply retroactively to all crypto holders.
- Meanwhile, in the United States, the crypto sector is moving in the opposite direction as it seeks to integrate into the regulated banking system.
The proposed crypto tax regime change in Germany
Effective in 2028 if approved, the proposed change in tax regime for crypto in Germany provides for a flat tax of 25%. This will apply to all assets acquired after January 1, 2027. A clause would, however, protect assets purchased before this date, which would remain subject to current tax rules. In other words, the measure does not shake the table for everyone overnight, but it clearly changes the situation for all future crypto purchases.
Under the current regime, gains on cryptos become fully tax-exempt after holding them for more than twelve months. Which therefore makes current Germany a particularly attractive tax destination for holders in Europe. The Minister of Finance, Lars Klingbeil, had already announced at the end of April the country’s intention to review its crypto taxation. With a target of $2.3 billion in additional tax revenue expected.
Zero crypto tax: the end of a special status in Europe
This project marks a turning point for a country which had built, almost by default, a reputation as a crypto tax haven within the European Union. The total exoneration after one year of detention had no such generous equivalent among its neighbors. Which naturally attracted long-term investors seeking to optimize their taxation without leaving the EU.
However, several gray areas remain at this stage. The Ministry of Finance has not yet responded to requests for details of the text, and the timetable leaves a narrow window between the reference acquisition date which is January 1, 2027 and the effective entry into force of the new tax in 2028. It also remains to be seen how this changeover will be precisely articulated with the European crypto tax reporting rules already being deployed, such as DAC8.
The United States is banking cryptocurrencies
And this is where the contrast becomes interesting. While Germany tightens its crypto taxationBlock, the payments company founded by Jack Dorsey, has officially applied for a charter from the Office of the Comptroller of the Currency (OCC), the US federal banking regulator, to create Builders Bank & Trust. If approved, this structure would be responsible for guarding bitcoin and stablecoins. But also, to offer digital asset services under a unified federal banking framework.
It would not be a traditional bank with deposits and credits. But from a structure focused on asset custody and digital financial infrastructure. And Block is not alone in this field as several other large American crypto companies are also pushing to obtain regulated banking status in the United States. The movement reverses the historical logic of the sector where it was the banks which gradually integrated bitcoin into their services. Now, it is Bitcoin companies that build the banks themselves.
What to remember about the possible change in crypto tax regime in Germany?
- Germany is preparing a flat tax of 25% on crypto gains acquired after January 1, 2027, applicable from 2028, ending the total exemption after one year of holding.
- A clause of “grandfathering” would protect assets purchased before that date from the new rules.
- In the United States, Block (Jack Dorsey) requested a federal banking charter from the OCC to custodian bitcoin and stablecoins, in a broader movement to bank the American crypto sector.
Two countries, two trajectories. Germany is closing Europe’s most generous tax bracket for crypto, while American crypto companies seek to become banks in their own right. The standardization of the sector clearly does not follow the same route on both sides of the Atlantic.
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