What is behind the possible abolition of the crypto holding period

The discussion about the Abolition of the cryptoHolding period in Germany is picking up speed. A current position paper by the SPD, in particular the so-called Seeheim Circle, demands that Profits from cryptocurrencies taxable in future regardless of holding period should be. The central idea is: „Income is income“ - regardless of whether it comes from labor, capital or digital assets. This would fundamentally change a central tax regulation for crypto investors in Germany.

To date, the following applies in Germany § Section 23 of the Income Tax Act (EStG): Anyone who uses Bitcoin, Ethereum or other cryptocurrencies lasts longer than twelve months, can use the profits from the sale tax-free realize. This regulation is unique in the European Union and was originally created to treat trade in digital goods in the same way as physical goods. However, if you sell within one year, profits are considered taxable - They are then taxed at the individual income tax rate.

With the new SPD initiative, this could Holding period abolished or severely restricted become. The aim would be Permanent taxation of crypto profits, comparable to the final withholding tax on capital gains. That would mean: Every sale, no matter when, would be subject to tax. This would remove the most important tax advantage in the German crypto market for many investors.

For beginners, this means in concrete terms:

• Who Coins for more than one year currently benefits from tax exemption.
• If the holding period is abolished every sale is taxable, even after several years.
• A sale at a profit would then automatically be considered a taxable transaction - similar to interest or dividends.

This potential change would have far-reaching consequences for private investors, traders and crypto companies. Long-term holding strategies (HODL) would be devalued for tax purposes, while short-term or active trading strategies would be treated equally for tax purposes. Many experts warn that this Germany loses competitiveness, as countries such as Portugal and Switzerland continue to offer tax-friendly regulations.

Why the topic is so explosive right now:

1. International comparability: In Austria, the tax exemption for crypto was already abolished in 2024 - profits have always been taxable there since then.
2. Fiscal pressure: In view of rising government spending, standardizing the taxation of income is politically attractive.
3. Signal effect: An abolition of the holding period would show that Germany Cryptocurrencies not as a long-term asset class, but as a taxable financial product considered.

For investors and crypto companies, this means that now is the right time to rethink your own strategy, examine tax scenarios and keep a close eye on possible legislative changes.

What is the crypto holding period and why does it exist?

To understand the current debate about the SPD's demand, you need to know, what the crypto holding period actually means and the tax law principles behind it. The regulation originates from the German Income Tax Act (§ 23 EStG) and treats cryptocurrencies legally as private sales transactions - similar to antiques, works of art or gold.

The basic principle is:
Anyone who uses cryptocurrencies such as Bitcoin, Ethereum or Solana longer than twelve months holds, it can sell tax-free. If the position within one year resold, the profit is taxable. The decisive factor is the individual income tax rate, which - depending on income - can be up to 45 % plus solidarity surcharge can amount to.

This so-called Speculation period was originally introduced to recognize short-term profits from trading activities for tax purposes, but to promote long-term investments. It forms the Tax incentive for long-term holding, similar to traditional tangible assets. It is particularly attractive for small investors because they can build up long-term assets without incurring a tax burden.

Example:
An investor buys 1 Bitcoin for € 20,000 in January 2023. If he sells this in February 2024 for € 40,000, i.e. after more than a year, the Profit of € 20,000 tax-free. However, if he had sold in October 2023, the profit would have been taxable and would have to be declared in the income tax return.

Important: The deadline refers to on each individual transaction - i.e. per coin or token. In addition, the FIFO method („First In, First Out“)
to calculate which coins are considered sold first if several purchases were made at different times.

The previous legal situation was amended several times by the Federal Ministry of Finance (BMF letter dated May 10, 2022) confirmed. For the first time, it defined in detail how staking, lending or Airdrops are to be treated for tax purposes. Particularly relevant: When investors sell their coins lend or lease (Lending/staking), the holding period is even extended to ten years. This regulation has been the subject of debate for years, as it affects the tax treatment of complex DeFi activities considerably more difficult.

The motivation behind the SPD's demand to abolish the holding period lies precisely here:

• The system is complicated, difficult to control and leads to high administrative costs at tax offices.
• Tax-free profits deprive the state of considerable revenue.
• The SPD increasingly sees cryptocurrencies as speculative financial products, which are not comparable with physical assets.

This would mean that the state would end the special tax treatment of crypto investors and treat cryptocurrencies similarly to Interest, dividends or price gains from securities, all of which are permanently subject to tax.

For investors, this means that abolishing the holding period would be A paradigm shift in German tax law. The previous separation between short-term trading and long-term investment would be abolished - with significant consequences for strategic portfolio decisions and location attractiveness.

The SPD's demand and political background

The current proposal for Abolition of the crypto holding period comes from the ranks of the SPD, more precisely from the Seeheim Circle, an influential pro-business wing of the party. In a new financial policy position paper, this group calls for a fundamental reorientation of tax policy: all income should be treated equally - regardless of its source. This explicitly includes profits from cryptocurrencies.

Background to the SPD demand

The document, which was published under the title „Guard rails for the financial policy of tomorrow“ contains the core statement:

„Income is income - regardless of whether it comes from work, capital or crypto profits.“

The SPD would like to Closing tax loopholes and end „unjust privileges“. The party argues that digital assets such as Bitcoin or Ethereum have long been Financial products and should therefore no longer be treated as „private assets“. According to the SPD, the one-year tax exemption distorts the equal treatment of different types of income and is no longer in keeping with the times.

In concrete terms, this means:

• Crypto profits should always be taxable in future, regardless of the holding period.
• The tax parity with interest and dividends is the goal of the SPD.
• The Ministry of Finance is to examine how these changes can be implemented legally and administratively.

Motives of the SPD

1. Tax justice: The SPD sees the holding period as a privilege for investors that is incompatible with the principle of fairness in German tax law.
2. Financing of the state: In view of rising budget deficits and additional expenditure (e.g. energy transition, infrastructure), additional sources of income are welcome.
3. Consumer protection: The SPD emphasizes that cryptocurrencies are speculative and that investors must be better protected against high losses.
4. Financial stability: Due to high market volatility, the party sees crypto investments as a risk for the financial system, which should be more strictly regulated.

Political dynamics

The topic is highly explosive in the federal government. While the Federal Ministry of Finance (BMF) While the FDP-led government has so far stuck to the current tax treatment, the SPD is now pushing for a reform. Whether the FDP - as an open-crypto party - would agree to such a change is questionable. The discussion is therefore likely to part of the 2025 tax reform debate.

There are also different positions within the SPD:

• The left wing takes a critical view of cryptocurrencies and supports the abolition of the holding period as an instrument to curb speculation.
• The Seeheim Circle argues more fiscally - with a focus on budget stability and equal taxation of all income.

Reactions from the crypto community

Crypto associations such as the Blockchain Federal Association and the Digital association Bitkom sharply criticize the idea. They warn that Germany could be internationally attractiveness as a crypto location would lose. Many founders and investors could move abroad - for example to Portugal, Switzerland or Estonia, where crypto profits are partly tax-free or tax-privileged.

Experts such as Roman Reher (Blocktrainer.com) see the SPD demand as a „fatal signal“ for Germany's innovative strength. A flat-rate tax liability without a holding period would make long-term investing unattractive and thus promote the opposite of sustainable capital formation.

Conclusion:
The SPD demand is politically strategically motivated and part of a broader tax debate. It represents an attempt to treat cryptocurrencies as a regular financial product - but at the expense of the existing incentives for long-term, responsible investing.

Possible changes to tax law - scenarios & regulatory options

If the SPD were to implement its tax policy demand, this would be one of the biggest interventions in German crypto taxation since the introduction of the holding period mean. While Section 23 EStG currently still allows tax-free profits after twelve months, the new model is aimed at a Permanent tax liability on all crypto sales - regardless of holding period, purpose of use or transaction type.

Scenario 1: Complete abolition of the holding period

In this case, any sale of cryptocurrencies would be treated as a Taxable transaction apply. Profits would then have to be Investment income treated in a similar way to interest, dividends or share profits.

• tax rate: 25 % withholding tax plus solidarity surcharge and church tax, if applicable.
• Advantage for the state: Standardization of taxation, simple control, less audit work for tax offices.
• Disadvantage for investors: Elimination of tax exemption and increasing tax burden, even for long-term investments.
• effect on the market: Shorter holding periods, less planning security and possible capital flight to more tax-friendly countries.

Scenario 2: Reformed holding period with income limits

One conceivable compromise model would be a Modified holding period, where tax-free profits are only possible up to a certain amount - e.g. up to € 5,000 per year. Profits in excess of this would be taxed automatically.

• Target: Protection of small private investors with simultaneous taxation of large profits.
• Implementation: Adjustment of the exemption limits in Section 23 EStG; retention of the holding period for small investors.
• Rating: politically easier to implement because it relieves the burden on the middle classes without completely abandoning the SPD's logic of equality.

Scenario 3: Transitional regulation with grandfathering

If the holding period is abolished, it would have to be legally examined whether Protection of existing stocks applies. Legally, the following applies in Germany Prohibition of retroactivity, i.e. profits from coins acquired before the new law came into force, should not be taxed retroactively become.

• Option A: Sales of coins purchased before 2026 remain tax-free if they meet the old deadline.
• Option B: Introduction of a transitional period (e.g. twelve months after the reform comes into force) before the new rule takes effect.

Scenario 4: Integration into the Capital Gains Tax Act

An alternative would be the Shifting crypto taxation to the Capital Gains Tax Act (EStG Section 20). Cryptocurrencies would then be treated legally like shares or funds.

• Uniform tax rate (flat-rate withholding tax)
• No influence of the holding period
• Simplified reporting obligation via banks or crypto brokers
  This would simplify tax law, but also tighten controls, as transaction data would in future be transmitted directly from stock exchanges to the tax offices would - in particular due to the EU-wide DAC8 guideline, which is due to come into force in 2026.

Political feasibility

It is currently unclear whether the SPD will be able to push through its demand in the coalition. The FDP is likely to put up resistance, as it sees the crypto sector as a driver of innovation. However, a Integration into a comprehensive tax reform serve as a compromise path. It is conceivable that the SPD could argue at EU level and Germany could only decide on implementation.

Conclusion: Tax reform with a signal effect

Regardless of which model is used, the current discussion shows that Tax-free crypto profits in Germany are under political pressure. Investors should include possible scenarios in their strategy at an early stage in order to benefit from transitional periods or grandfathering. A reform would standardize tax law, but would also significantly weaken the attractiveness of the location for crypto companies and private investors.

Implications for crypto investors

The possible Abolition of the crypto holding period by the SPD would have far-reaching consequences for private investors, traders and institutional investors. It would not only change tax planning, but also realign the entire investment behavior in the German crypto market.

1. loss of tax exemption - end of the „HODL“ principle

The biggest cut affects long-term investors who have so far benefited from the tax-free sale after twelve months profit. Anyone who views Bitcoin or Ethereum as a long-term investment has so far been able to realize profits without any tax burden. This regulation was one of Germany's most important locational advantages in a European comparison.

This means that the holding period no longer applies: Every sale is taxable - even years later. This means that the popular „buy & hold“ principle loses its tax advantage. In future, investors would have to pay tax on every portfolio reallocation or profit-taking. Factor in taxes, similar to shares or funds.

Example:
An investor buys 1 BTC for € 20,000. Three years later, the price is € 60,000. Under current regulations, the €40,000 profit would be tax-free. Under the planned SPD regulation, this €40,000 would be fully taxable, which - depending on income - could mean a tax burden of up to €18,000.

2. increased administrative and documentation costs

In future, investors would have to Record every transaction for tax purposes, as the time no longer plays a role. This means that

• Complete documentation of all purchases, sales, swaps, airdrops and transfers.
• Use of professional tools such as CoinTracking, Accointing or Blockpit is absolutely essential.
• Incorrect information could have tax consequences, as tax offices are increasingly evaluating blockchain data automatically.

With the planned EU directive DAC8 this transparency obligation will be tightened from 2026 anyway - stock exchanges will have to report transactions directly to national tax authorities. A permanent tax obligation would only accelerate this process.

3. strategic consequences for long-term investors

For long-term holders (HODLers), the most important incentive to remain in Germany no longer applies. Many investors could move their holdings to legal vehicles like corporations in order to tax profits with corporation tax instead of income tax.
Others could talk about Emigration to more tax-friendly countries Portugal, Malta or Switzerland, for example, where crypto profits continue to be tax-free or tax-privileged.

Entrepreneurially active crypto investors (e.g. miners, DeFi users, validators) would have to rethink their tax structure. If all transactions become taxable, a professional Tax and legal management indispensable.

4. short-term market reactions

A short-term political announcement to abolish the holding period could trigger massive reactions in the market:

• Sales waves shortly before a reform comes into force („tax panic“)
• Price pressure due to short-term profit realization
• Decline in trading activity for German users
• Migration of volumes to international stock exchanges

A similar dynamic was already observed in Austria in 2024, after crypto tax exemption was abolished there.

5. opportunities for active traders

Not all effects would be negative. Active traders who trade frequently anyway may benefit from clearer rules and simplified processing via the flat-rate withholding tax.
In addition, a uniform tax model for crypto-assets could reduce the legal uncertainty surrounding staking, lending and DeFi. A clear classification of these activities could lead to More transparency and legal certainty even if it becomes more of a tax burden.

Conclusion

The abolition of the crypto holding period would be a major setback for many private investors. It would make long-term investing less attractive and set Germany back in international comparison. At the same time, however, it also opens up opportunities for a clearer, EU-wide harmonized tax regime. The decisive factor is, how transparent and fair the implementation is - particularly with regard to old stocks and transition periods.

Effects on Germany as a business and financial center

The possible abolition of the tax-free crypto holding period would not only be a decision with consequences for private investors, but also a Economic and location policy signal. Germany is one of the few EU countries in which long-term crypto investments are tax-privileged. In recent years, this regulation has contributed significantly to the fact that a growing number of crypto Crypto and blockchain scene could develop.

1. loss of location attractiveness

The tax-free holding period was a clear competitive advantage in a European comparison. It made Germany attractive to many investors - despite the high tax burden in other areas.
By abolishing them, Germany would be central location advantage lose. Projects, start-ups and funds that were previously based here could relocate their structures to countries with more stable tax conditions.

The following are currently particularly attractive:

• Portugal: Crypto profits are still tax-free for private individuals there.
• Switzerland: Tax regulations for long-term investors vary from canton to canton, but are usually favorable.
• Estonia & Malta: Clear regulation, low corporate taxes, tax neutrality for tokenization.

Eliminating the holding period could therefore Outflow of capital, know-how and innovation from Germany - similar to Austria after the 2024 tax reform.

2. signal effect for the financial market

A permanent tax liability on crypto profits would integrate the crypto market more strongly into the traditional Financial system integrate.

• Banks and financial service providers could expand their crypto offerings as regulatory uncertainties would be reduced.
• At the same time, the Free, decentralized character of the crypto market because investors would be more dependent on documented, tax-compliant trading venues.

On the one hand, this can Seriousness of the market but on the other hand make access more difficult for small investors. A tax regime that is too complex or unattractive could result in many private investors on foreign stock exchanges or peer-to-peer trading to avoid.

3. impact on innovation and blockchain start-ups

Germany has a vibrant Web3, NFT- and DeFi community. Many founders and developers operate in the Berlin, Munich and Frankfurt area. Tax planning security is crucial for these companies. Abolishing the holding period could force these players,

• to relocate their legal structures abroad,
• realize profits via subsidiaries outside the EU or
• not even start new projects in Germany.

Especially for Blockchain-Start-ups and crypto funds the tax-free holding period is an essential factor for capital acquisition. If it is removed, there is a risk of Shifting innovation to more tax-friendly jurisdictions.

4. political-economic dimension

From the SPD's point of view, the measure would be a step towards „Tax justice“ and revenue stability. In the short term, the state could generate additional revenue by taxing all crypto profits.
In the long term, however, economists warn that the effect negative for gross domestic product and the tax base if capital and companies migrate. The location would lose momentum, similar to the fintech exodus to the UK and Switzerland in the 2010s.

5 Possible international counter-movements

At European level, this measure could give Germany a Trend towards standardization of crypto taxation trigger.
In any case, the EU Commission is working on a framework that will be supported by the MiCA-Regulation and DAC8 to harmonize tax transparency. However, most countries are opting for moderate regulations so as not to slow down innovation. By radically abolishing the holding period, Germany would be putting itself in a Restrictive pioneering role with an uncertain economic outcome.

Conclusion

The SPD demand is more than just a tax policy detail. It directly affects the Germany's strategic position in the global crypto ecosystem. An ill-considered abolition of the holding period could drive away capital, start-ups and innovations. If Germany wants to remain a leading location for blockchain and digital assets in the long term, it needs Stable, competitive and innovation-friendly framework conditions - not only tax revenues.

Pros & cons - voices from politics, industry and science

The debate surrounding the abolition of the crypto holding period is highly polarized. While supporters in the SPD see the measure as a step towards more Tax justice and regulation economists, industry representatives and crypto associations are warning against a massive setback for innovation and location attractiveness.

1. pro-arguments of the SPD and its supporters

a) Tax justice and equal treatment:
The SPD argues that Income from cryptocurrencies should be subject to the same rules as capital gains from shares or interest. A tax-free Bitcoin profit after twelve months is difficult to justify from a socio-political perspective if all other investor groups pay taxes permanently at the same time.

b) Simplification of tax law:
Eliminating the holding period would make the system clearer. Tax offices would no longer have to check whether a transaction was within or outside the time limit. This reduces the administrative burden and makes tax evasion more difficult.

c) Revenue potential for the state:
According to estimates, the state loses several hundred million euros through tax-free crypto sales. Permanent taxation would Broadening the tax base - an argument that carries weight in the face of tight budgets.

d) Financial market stability and consumer protection:
The SPD increasingly sees cryptocurrencies as speculative asset class. Continuous taxation is intended to mitigate excessive speculation and price bubbles. In addition, investors are to be better protected by clearer rules and obligations.

2. contra-arguments of the crypto industry and specialist economists

a) Innovation barrier and capital outflow:
The Blockchain Federal Association and the Bitkom e.V. warn that such a tax policy Stifling innovation. Start-ups, funds and investors could expand their activities in Crypto-friendly jurisdictions such as Switzerland, Portugal or Estonia. Germany would lose know-how and taxpayers as a result.

b) Contradiction to the coalition agreement:
The 2021 coalition agreement between the SPD, FDP and the Greens stipulated that Germany should become a leading location for blockchain technology is to be abolished. The abolition of the holding period would be clear contradiction to this objective and undermines the credibility of the Federal Government.

c) Unequal treatment of asset classes:
Cryptocurrencies are different in nature to shares - decentralized, unissued and not tied to companies. Many experts therefore see no objective basis for treating them in the same way for tax purposes. A blanket tax liability would be a technocratic simplification, that ignores the reality of the market.

d) Risk for retail investors:
A permanent tax liability primarily affects Private investors with small portfolios, as they would be forced to pay tax on every small transaction. The cost of documentation and tax returns could exceed the potential profit.

e) Competitive disadvantage for Germany as a business location:
Economists such as Prof. Philipp Sandner (Frankfurt School Blockchain Center) emphasize that the holding period is a Decisive location advantage is. It motivates investors to keep capital in the country in the long term instead of shifting it to foreign markets. A discontinuation would set Germany back years as a crypto location.

3. voices from the field

• Roman Reher (Blocktrainer.de): „With this initiative, the SPD is showing that it still sees cryptocurrencies as a threat rather than an opportunity.“
• Bitcoin-Bundesverband: „Abolishing the holding period would be a fatal signal for all those who have taken Germany seriously as a digital financial center.“
• Federal Association of German Startups: „Such plans deter founders and jeopardize investments in the blockchain industry.“

Conclusion

The debate reflects the fundamental conflict of objectives between equal fiscal treatment and innovation-friendly location policy. Proponents want a fairer, simpler tax law - critics warn of a loss of innovative strength, capital and credibility.
Uncertainty remains for investors, entrepreneurs and developers: It is still unclear whether the SPD will be able to push through its demand in the coalition. However, one thing is clear Any tax reform in this area will have long-term consequences for the crypto market in Germany.

Outlook & conclusion

The debate about the Abolition of the crypto holding period marks a turning point for the German crypto market. It shows that digital assets have finally become the focus of tax and financial policy. While Germany was previously one of the few countries in the EU to offer favorable tax treatment for long-term crypto investments, there are now signs of a change. Approximation to the classic capital gains system to.

1. political perspective

The SPD is using the issue to sharpen its economic and financial policy profile. With the argument of Tax justice it wants to tax crypto profits permanently and secure revenue for the state.
The crucial question, however, is: Will it find a majority in the coalition?

• The FDP is likely to put up resistance, as it is in favor of an innovation-friendly tax policy.
• The Greens stand between the two camps - they call for regulation, but also emphasize sustainability and the promotion of innovation.
  It is therefore likely that the issue will first be fleshed out in working groups and draft legislation before it becomes an actual reform. Implementation would be possible at the earliest 2026 realistic.

2. economic perspective

Should the holding period actually be abolished, Germany would catch up with countries such as Austria, France and Italy in terms of taxation. However, this would come at a price:

• Long-term investors would be at a tax disadvantage.
• Company and capital could migrate to more tax-friendly countries.
• Start-ups and Web3 projects would have to reorient themselves.

The result would be a massive restructuring of the crypto landscape in Germany - away from the HODL market and towards more strictly regulated, taxable trading activities.

3. social perspective

The SPD justifies its initiative with social equality. However, critics complain that the measure primarily Private investors burdened, who invest for the long term, while large corporations could continue to benefit from tax advantages through holding structures. A flat-rate tax liability could therefore reinforce rather than reduce social inequalities.

4 Legal and regulatory developments

In parallel to national initiatives, the EU is working with the DAC8 guideline and the MiCA Regulation on the standardization of tax and reporting obligations.

• DAC8 obliges crypto exchanges to report customer transactions to national tax authorities from 2026.
• MiCA creates a Europe-wide legal framework for crypto-assets and stablecoins.
  This will increase tax transparency anyway - regardless of the national holding period.

Germany could therefore also interpret the SPD demand as an anticipation of future EU requirements in order to position itself as a „regulator“ within Europe.

5. recommendation for action and conclusion

This applies to investors, companies and tax consultants:

• Short term the holding period will remain in place until the law is changed. Profits after twelve months are still tax-free.
• Medium-term you should prepare for a reform - for example through strategic sales, structured accounting and tax advice.
• Long-term the reform will determine Germany's role in the global crypto market. If it is implemented too restrictively, there is a risk of an exodus of innovation, capital and talent.

Germany is at a crossroads: either it shapes the tax future of crypto Innovation-friendly and compatible with Europe, or it will lose touch with the next wave of financial technology.

The coming months will show whether the German government is prepared to strike a balance between Tax justice and competitiveness or whether the SPD initiative will become a symbol of a missed opportunity.

FAQ - Frequently asked questions about the abolition of the crypto holding period in Germany

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What does the crypto holding period actually mean?

The crypto holding period is a tax regulation according to § Section 23 of the Income Tax Act (EStG). It states that profits from private crypto sales tax-free after a holding period of twelve months are. If a coin or token is sold beforehand, the profits are taxable and must be taxed at the personal income tax rate.

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What are the SPD's concrete plans?

The SPD - more precisely the Seeheim Circle, a pro-business wing of the party - is calling for this holding period to be to be completely abolished. Profits from Bitcoin, Ethereum or other cryptocurrencies are to be always taxable regardless of the holding period. According to the SPD, the aim is „fairer taxation of all types of income“.

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Why does the SPD want to abolish the holding period?

The SPD argues with Tax justice, transparency and financial stability. Cryptocurrencies are now speculative financial products, not traditional economic assets. Tax-free profits after twelve months would lead to unequal treatment and weaken the state budget.

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How would the abolition affect investors?

For private investors, the tax advantage of long-term holding does not apply. Any sale would be taxable, even after several years. This means

• Higher tax burden each time profits are taken.
• No more incentive for long-term investments („HODL“).
• More complex tax returns and increased documentation requirements.

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Will the SPD demand actually be implemented?

Not yet. The proposal is a Position paper, not a draft law. Implementation would require the approval of FDP and Greens within the coalition. As the FDP in particular is against a tightening of the crypto tax, a short-term implementation is considered to be unlikely, but possible in the medium term - as part of a comprehensive tax reform from 2026.

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What happens to existing coins (old stocks)?

According to German tax law, the Prohibition of retroactivity. This means: profits from coins that before a new regulation comes into force should not be subject to tax retroactively.
It is therefore likely that a Grandfathering or a transitional period, so that old stocks continue to fall under the old regulation.

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How can I prepare for a possible abolition?

• Check tax strategy: plan sales under the current regulation.
• Document transactions: Use tools such as CoinTracking or Blockpit.
• Obtain advice: Consult tax experts with crypto experience.
• Diversify portfolios: Shift a portion to tax-friendly forms of investment or countries.

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What alternatives are there for tax-optimized investing?

Investors can legally reduce their tax burden even without a holding period:

• Use of Corporations (e.g. GmbH), to tax profits with corporation tax.
• Long-term ETF or bond products, which remain tax-privileged.
• Tokenized tangible assets (RWA), whose income is treated differently.
• Relocation of residence to countries with more favorable crypto taxation such as Portugal or Switzerland.

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How are crypto associations and experts reacting?

Associations such as the Blockchain Federal Association and the Bitkom e. V. reject the SPD demand. They warn of a loss of Innovation, capital and jobs. Experts like Prof. Philipp Sandner (Frankfurt School) and Roman Reher (block coach) describe the proposal as a „location risk“ for Germany.

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What could the new taxation look like?

Probably a Withholding tax similar to investment income:

• Uniform rate of 25 % + solidarity surcharge (+ church tax if applicable).
• No influence of holding period.
• Reporting and settlement via crypto exchanges in accordance with the EU Directive DAC8.
  This would put crypto on an equal footing with shares and funds for tax purposes, but would also make all profits taxable.

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When could the reform come into force?

If the proposal is implemented, the earliest start would be 2026 realistic - after the end of the current legislative period and possible new elections.
A draft law would first have to be drawn up, discussed in parliament and passed. Investors therefore have still time to prepare.

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What does this mean for Germany as a business location?

Abolishing the holding period would bring Germany into line in terms of taxation, but Weaken economically.

• Founders and investors could move abroad.
• Start-ups would lose capital.
• Germany would lose its pioneering role as a regulated but attractive crypto location.
  In the long term, confidence in Germany as a financial center would suffer if there were no tax stability.

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Conclusion:
The SPD's call for the abolition of the crypto holding period is a political signal for more control, but also a potential damper on innovation and capital. Investors should follow developments closely, take advantage of existing tax benefits and adjust their strategy in good time.

Source list - SPD demand to abolish the crypto holding period

Primary sources (official documents & government agencies)

1. Income Tax Act (EStG) - Section 23 Private sales transaction
2. Federal Ministry of Finance (BMF) - Letter on the income tax treatment of virtual currencies (May 10, 2022)
3. SPD Seeheimer Kreis - Financial policy position paper „Guard rails for a financial policy of tomorrow“ (October 2025)
4. European Commission - DAC8 Directive (2023/2226/EU)
5. EU Regulation (MiCA) - Markets in Crypto-Assets Regulation (MiCAR)