Denmark’s Tax Law Council has proposed a new tax plan that will tax unrealized profits and losses on digital assets, thereby affecting crypto investors. If these measures receive approval, they could begin as early as 2026, significantly impacting the portfolio management of Danish crypto investors.
The Council’s 93-page study presents three possible models for taxing crypto assets: capital gains tax, warehouse taxation, and inventory taxation. The Council is most likely to embrace the “inventory taxation” concept. Whether or not the goods have been sold, investors’ whole bitcoin holdings would be handled under this approach as a single inventory, taxed yearly.
Emphasizing the necessity of a simpler and more equitable tax system for crypto investors, Danish Tax Minister Rasmus Stoklund pointed out that present capital gains tax rules have produced unjust results for many. It should be clear, though, that the suggestions in the study are not definitive, and any modifications would still need approval from the Danish Parliament.
The Council also recommended mandating that crypto service providers—exchanges and payment systems—report customer transaction data, therefore enabling all European Union countries to access this information. This is in line with more general initiatives throughout Europe aimed at more efficient control of the bitcoin industry.
This possible action to tax unrealized profits reflects similar ideas put forward elsewhere. While Italy is currently debating the taxation of Bitcoin holdings, the United States has been discussing the possibility of taxing unsold assets. If adopted, Denmark’s revised tax laws could set a standard for the worldwide and European taxation of digital assets.
