The European Union's DAC8 rules, effective January 1, 2026, mandate crypto-asset service providers to collect and report tax data on EU residents. Contrary to claims of an immediate end to crypto privacy, the directive establishes a reporting cycle with the first full-year reports due in 2027. DAC8 targets exchanges between crypto and fiat, crypto-to-crypto transactions, and transfers, including withdrawals to self-custody wallets. While the directive doesn't eliminate self-custody, it expands tax visibility by requiring providers to report transfers to unhosted addresses. Exchanges may eventually restrict users from performing reportable transactions if they don't provide the required tax information after reminders. The new regulations shift the compliance burden to onboarding, identity, and access controls for exchanges.

The European Union's DAC8 rules, effective January 1, 2026, mandate crypto-asset service providers to collect and report tax data on EU residents. Contrary to claims of an immediate end to crypto privacy, the directive establishes a reporting cycle with the first full-year reports due in 2027. DAC8 targets exchanges between crypto and fiat, crypto-to-crypto transactions, and transfers, including withdrawals to self-custody wallets. While the directive doesn't eliminate self-custody, it expands tax visibility by requiring providers to report transfers to unhosted addresses. Exchanges may eventually restrict users from performing reportable transactions if they don't provide the required tax information after reminders. The new regulations shift the compliance burden to onboarding, identity, and access controls for exchanges.