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As cryptocurrencies gain popularity worldwide, Denmark is considering a major shift in how it taxes crypto assets.

Denmark's Tax Law Council has proposed new rules that might tax unrealized gains and losses starting as early as 2026. If passed, the changes would place Denmark among the few nations directly taxing crypto assets in this manner.

In a detailed 93-page report, the Council laid out three possible taxation models for crypto: capital gains tax, warehouse taxation, and inventory taxation. 

The report, presented by Danish Tax Minister Rasmus Stoklund, expressed concerns that the current capital gains tax system unfairly burdens many investors. Stoklund pointed to the need for a simpler, more transparent way of handling crypto taxes.

While the proposals are still under consideration and no laws are yet in place, the Council's preferred option appears to be “inventory taxation.” 

This model treats an investor’s entire crypto portfolio as an inventory, which would be taxed annually based on its value at a set date, regardless of whether any assets were sold.

Importantly, the report also calls for crypto service providers, such as exchanges, to report detailed customer transaction information across the European Union, further aligning Denmark’s approach with EU standards. 

However, no changes are expected until 2026, with the bill likely being introduced to Parliament in 2025.