With cryptocurrency taxation still in its infancy, every court decision provides valuable insights for investors. A recent judgment by the Lille Administrative Court has clarified the criteria for assessing the "habitual" nature of cryptocurrency buy-sell activities (TA Lille, February 5, 2026, No. 2305612).
The court ruled that three sales spaced two years apart fall under private asset management rather than a commercial activity, despite (i) the significant value of the disposals, and (ii) the taxpayer's formal declaration of a professional activity.
Before examining the facts of the case, it should be noted that capital gains realized by individuals on the occasional sale of cryptocurrencies have, since the 2026 Finance Act, generally been subject to a flat tax (PFU) at a rate of 31.4% (previously a global rate of 30%), with the option to choose taxation at the progressive income tax scale (Article 150 VH bis of the General Tax Code (CGI)).
However, beyond such occasional disposals, the tax treatment of cryptocurrencies can vary significantly: gains may fall under the category of non-commercial profits (BNC) when obtained in exchange for "mining" activities (i.e., participating in transaction security), or under the category of industrial and commercial profits (BIC) when buy-sell activity is conducted on a habitual basis.
It was this second category and the concept of "habitual" activity that were at the heart of the dispute before the Lille court.
In this instance, the taxpayer had declared a cryptocurrency buy-sell activity as a sole trader since 2017. However, he had only carried out three disposals spaced two years apart: one in 2017 (for €170,000), one in July 2019 (for €827,000), and one in March 2021 (for an undisclosed amount). Furthermore, the taxpayer could not provide evidence of any purchase transactions during the audited period. Following a tax audit, the authorities challenged the habitual nature of the activity and subjected the gains to income tax under the private capital gains regime of Article 150 VH bis of the CGI (noting that the judgment does not explicitly state why BIC classification was more favorable to the taxpayer in this case).
The judges held that the absence of purchase operations and the occasional nature of the disposals precluded any habitual activity, notwithstanding the significant amounts of the sales. The gains were therefore deemed to arise from the management of the taxpayer's private assets.
This ruling, which represents the first application of the tax regime for cryptocurrency gains since the clarifications provided by the Conseil d'Etat decision of April 26, 2018 (No. 417809), remains subject to appeal at the time of writing. Nevertheless, it provides essential guidance on how tax courts assess the habitual nature of cryptocurrency trading. Sophisticated investors should therefore pay close attention to the frequency of their transactions.
