For years, Germany has been one of the most crypto-friendly countries for long-term investors. Hold Bitcoin for over a year, and profits are completely tax-free. Now that advantage may be under threat.

Finance Minister Lars Klingbeil recently announced that crypto taxation would be revised as part of the 2027 federal budget. While the details are still being worked out, speculation is mounting that Germany is ready to close its famous crypto tax loophole.

Germany currently treats cryptocurrencies as private assets, similar to gold or collectibles.

Under Section 23 of the Income Tax Act, investors pay no taxes on gains if they hold assets for longer than one year. That rule helped position Germany as an attractive…