Beyond MiCA: Why Tax Transparency May Define Europe’s Next Phase of Crypto Regulation

Europe’s crypto debate has largely focused on market regulation. The European Union’s (EU) Markets in Crypto-Assets Regulation (MiCA) created a harmonised framework for issuers and service providers, addressing authorisation, market integrity and investor protection. Yet the more consequential institutional change may now be occurring through tax law. The OECD’s Crypto-Asset Reporting Framework (CARF) and the EU’s DAC8 Directive are turning crypto intermediaries into tax-information gatekeepers. They are not merely adding compliance duties: they are integrating crypto-assets into the infrastructure through which states observe and exchange information about cross-border wealth.

MiCA is only half the regulatory story

MiCA is rightly regarded as a landmark in European financial regulation. It gives crypto-asset businesses a common regulatory vocabulary and replaces fragmented national approaches with a Union-wide framework.

But market supervision answers only one part of the legal problem. It regulates who may provide services and how users and markets should be protected. It does not, by itself, solve the informational problem faced by tax administrations: how to identify taxpayers, trace reportable transactions and determine whether crypto-related income and gains have been declared.

Although these instruments do not alter tax rates or tax bases, their effects may extend beyond information collection. Greater visibility can change incentives: taxpayers may be more likely to report accurately, while providers may redesign onboarding and record-keeping around compliance. CARF and DAC8 are therefore not behaviourally neutral.

That is the problem addressed by CARF and DAC8. CARF establishes an international standard for the collection and automatic exchange of information on relevant crypto-asset transactions. DAC8 embeds a corresponding regime within the EU’s system of administrative cooperation in taxation.

Neither instrument harmonises the substantive taxation of crypto-assets. They do not determine whether a gain is taxable, how it should be characterised or which rate should apply. Their power lies elsewhere: they make potentially taxable activity more visible to tax administrations. The emerging framework therefore regulates information before it regulates liability.

From technology platforms to tax-information gatekeepers

The central institutional innovation is the changing role of crypto intermediaries. Exchanges and other platforms were initially understood mainly as technological actors facilitating transactions. Under CARF and DAC8, they perform a function familiar from the traditional financial sector: identifying users, establishing tax residence, collecting transaction data and reporting information to public authorities.

The OECD’s implementation guidance shows the scale of this transformation. Reporting providers must develop due-diligence procedures, obtain self-certifications, identify reportable users and maintain systems capable of classifying and aggregating transactions. Compliance capacity is therefore becoming part of the business model, rather than an ancillary legal function.

These intermediaries do not become tax authorities. They do, however, become essential components of tax administration, much as banks and other financial institutions became central to the Common Reporting Standard.

DAC8 also shows why tax transparency cannot simply be treated as an extension of MiCA. Its reporting scope is not identical to the scope of MiCA’s authorisation requirements. The Directive applies both to service providers regulated under MiCA and to certain operators that are not. Tax law may therefore reach actors and activities that market regulation does not capture in precisely the same way.

This asymmetry matters. The next phase of crypto regulation will not be organised around a single instrument. Overlapping regimes will pursue distinct objectives and may define their scope differently. A MiCA authorisation will not, by itself, resolve the full range of tax-transparency obligations.

The transition is already operational

This development is no longer theoretical. The DAC8 rules apply from 1 January 2026. Reporting providers must collect information on reportable transactions occurring during 2026, with the first reporting and exchanges due in 2027. Internationally, the first exchanges under CARF are likewise expected to commence in 2027.

The question is therefore no longer whether crypto markets will enter systems of automatic exchange, but whether businesses and tax administrations can implement those systems consistently across jurisdictions.

Providers must determine users’ tax residence, manage cross-border registration and reporting obligations, classify transactions and protect large volumes of sensitive financial data. Divergent domestic implementation could create duplication and uncertainty. The framework’s success will depend not only on formal adoption, but also on administrative coordination and usable technical standards.

Transparency may support market integration

Tax transparency is often presented as a constraint on the crypto sector. That view is incomplete. Greater visibility may also support the sector’s integration into mainstream finance.

Institutional investors and regulated financial institutions need more than rules on market conduct. They also need confidence that transactions can be documented, tax obligations assessed and counterparties placed within recognised compliance systems. MiCA provides part of that certainty; CARF and DAC8 provide another.

Measures designed primarily to improve tax compliance could therefore strengthen the conditions for institutional adoption. Transparency can reduce some of the legal uncertainty that has kept digital assets at the margins of traditional finance.

But reporting does not eliminate uncertainty about the substantive tax treatment of crypto-assets, which remains fragmented across jurisdictions. Nor does it guarantee consistent interpretation. Tax transparency is a component of market maturity, not a substitute for coherent tax rules.

The privacy question is about governance, not secrecy

The expansion of reporting also creates a genuine data-protection challenge. DAC8 requires the collection and exchange of sensitive information, including identifying details, tax residence and aggregated transaction data. The issue should not be reduced to a choice between tax enforcement and crypto anonymity.

The more important question is how this information is governed. Under the EU’s General Data Protection Regulation, processing must remain necessary, proportionate and limited to legitimate purposes. Effective safeguards are required for access, retention, security and cross-border use.

The framework’s legitimacy will depend on whether it can distinguish transparency from unrestricted surveillance. Tax authorities need sufficient information to enforce the law, but reporting systems must not become an open-ended infrastructure for the reuse of financial data.

Beyond MiCA

MiCA regulates participation in crypto markets. CARF and DAC8 regulate the visibility of crypto activity to the state. Together, they mark a transition from treating crypto-assets as a separate technological ecosystem to treating them as part of the ordinary legal architecture of international finance.

The most important shift may therefore be the end of informational exceptionalism. Crypto-assets can remain technologically decentralised while becoming institutionally legible.

Europe’s next phase of crypto regulation will be defined not only by who may issue, trade or safeguard digital assets, but by who must report them, what information must be exchanged and how it may be used. The central question is no longer whether crypto can operate outside traditional systems. It is whether the emerging systems can integrate crypto without sacrificing legal coherence, proportionality and trust.

Sissy Stergiopoulou is a Greek tax lawyer and PhD researcher specialising in crypto-asset taxation and international tax transparency. Her research focuses on the OECD Crypto-Asset Reporting Framework, the EU DAC8 Directive and the interaction between digital assets, taxation and financial regulation.