On January 1, the European Union implemented DAC8, a directive expanding tax oversight of cryptocurrencies. The document requires exchanges, brokers, and crypto service providers to collect users’ personal data and full transaction histories and to transmit them to national tax authorities. That information is then automatically exchanged among all EU countries, creating a unified system of tax transparency for digital assets.
DAC8 is the eighth version of the Directive on Administrative Cooperation, which has traditionally been used for exchanging tax information on financial assets. Its scope has now officially been extended to cryptocurrencies and firms that work with them. The relevant data for 2026 is already being collected. Crypto firms have to adapt their processes by July 1. Penalties are provided for violations, and authorities have been granted powers to seize or freeze digital assets in cases of tax nonpayment.
Despite authorities positioning DAC8 as a step toward transparency, crypto‑market participants criticize the directive as undermining a core principle of cryptocurrencies: the right to privacy. Crypto educator Heidi Chakos noted that tax authorities have been given automatic oversight of users’ digital assets, making confidentiality more critical than before. The directive may stimulate interest in privacy coins and decentralized platforms.