Denmark Plans to Propose Tax on Unrealized Cryptocurrency Gains in Upcoming Bill
On October 24, the Danish Tax Law Council recommended the introduction of mark-to-market taxation on cryptocurrency assets in a new report, followed by a legislative proposal. This means that cryptocurrency investors would be taxed on unrealized cryptocurrency gains or losses if the rules come into effect. The committee said, “So-called mark-to-market taxation is considered capital income and involves ongoing taxation, regardless of whether the crypto asset is sold or not.” The tax committee explained that taxation has been a challenge due to the nature of crypto assets, which are “not subject to centralized regulation by entities such as governments or central banks.” The council recommended that the new tax regulations should come into effect no earlier than January 1, 2026.In early 2025, the Minister of Revenue plans to introduce a bill incorporating the council's recommendations. The bill is expected to include a requirement for crypto service providers to report information about their clients' crypto asset transactions. Mads Eberhardt, senior crypto analyst at Steno Research, wrote on X that the tax rate on unrealized capital gains could reach 42 percent, which would affect not only cryptocurrencies acquired since then, but also cryptocurrencies acquired since the Bitcoin Genesis block of January 2009.
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