DAC8: What the EU's New Crypto Reporting Rules Actually Mean

DAC8 came into effect on January 1, 2026, and is now live across the European Union. Predictably, it is being described online as "the end of crypto privacy" or "a ban on anonymous wallets".

That framing is wrong - but the change is significant.

DAC8 does not outlaw self-custody, force disclosure of private keys, or give governments real-time surveillance of your hardware wallet. What it does do is reshape how crypto wealth must be reported, verified, and contextualised when it touches regulated entities.

That distinction matters, particularly for anyone holding assets outside exchanges.

What DAC8 Actually Is

DAC8 is the EU's extension of the Directive on Administrative Cooperation to cover crypto-assets. Member states were required to transpose it into national law by December 31, 2025, with the directive's provisions applying from January 1, 2026.

Its purpose is straightforward: To give tax authorities visibility into crypto activity that occurs via regulated intermediaries.

It achieves this by imposing mandatory reporting obligations on Crypto-Asset Service Providers (CASPs), including centralised exchanges, custodial wallet providers, brokerages, and certain on - and off-ramp services.

These entities are now required to report standardised user and transaction data to national tax authorities, who may then share that information across the EU. Structurally, this mirrors how banks already report financial accounts.

What Information Is Reported

For accounts held with a reporting CASP, DAC8 requires the disclosure of identifying information such as name, address, tax residency, and Tax Identification Number (TIN), along with account identifiers, aggregate inflows and outflows, and certain transaction details - including some crypto-to-crypto activity.

Crucially, these obligations apply only to activity that is handled by or routed through a reporting intermediary.

What DAC8 Does Not Do

This is where much of the online commentary goes off the rails.

DAC8 does not ban self-custody wallets, require users to register hardware wallets, force disclosure of private keys or seed phrases, give authorities direct access to on-chain wallets, or automatically report balances held purely on-chain.

If you hold assets in a self-custodied wallet and do not interact with a reporting CASP, DAC8 does not create a new automatic reporting channel for those holdings.

The blockchain remains public.
Your keys remain private.
Self-custody remains lawful.

Where the Real Change Is

The meaningful shift under DAC8 is one of context, not custody.

Under the previous regime, crypto holders could plausibly argue that there was no reliable way for an institution to understand what they held without full disclosure or custodial transfer. That argument is rapidly collapsing.

Under DAC8, institutions are under increasing pressure to verify source-of-funds, regulators expect consistency between reported exchange data and declared holdings, and informal "trust me" disclosures no longer satisfy compliance teams.

This creates a new problem: How do you prove what you hold without surrendering control or oversharing data?

The Compliance Gap DAC8 Creates

DAC8 increases reporting on the institutional side, but leaves a notable gap on the user side.

Exchanges can report what passes through them, and tax authorities can see declared activity. However, self-custodied balances still need to be explained.

This is already surfacing in lending and credit assessments, enhanced due diligence reviews, proof-of-funds requests, and cross-border financial onboarding.

In response, many platforms have defaulted to blunt solutions: requesting screenshots, demanding full wallet histories, or requiring assets to be moved into custody.

All of these approaches are invasive, error-prone, and dangerous from a coercion and security perspective.

Why Verification Beats Disclosure

DAC8 does not require users to give up control; it requires institutions to be confident.

Those two things are not the same.

The future lies in cryptographic verification, not custodial disclosure - proving ownership without revealing keys, proving balances without exposing spend history, and proving access without granting control.

This is the difference between saying, "Here’s everything, please don’t misuse it," and saying, "Here’s a verifiable fact, nothing more."

Where Accredifi Fits

Accredifi exists precisely because regulations like DAC8 are becoming the norm.

It enables self-custody proofs through cryptographic signing, view-only verification scoped to balance, chain, or wallet group, time-limited access rather than permanent data leakage, and verification without custody, transfers, or spend authority.

For institutions, this means compliance without custody, auditability without honeypots, and proof-of-funds without key exposure.
For users, it means keeping keys offline, reducing coercion surface area, and remaining compliant without surrendering sovereignty.

DAC8 does not end crypto privacy - it ends informal ambiguity.

The Bigger Picture

DAC8 is not the end state; it is a waypoint.

Over the next three to five years, we should expect increasing pressure for standardised crypto proofs, a growing split between custodial convenience and self-custody verification, regulators becoming more comfortable with cryptographic attestations, and institutions preferring proofs they do not need to store or secure.

In that environment, the safest assets will not be the most hidden - they will be the most precisely provable.

Final Thought

DAC8 does not kill self-custody. It quietly makes poor verification practices untenable.

Those who adapt early by separating proof from control will have the smoothest path through the next regulatory cycle.

That is the design space Accredifi is built for.

Ready to prove your holdings the right way?
Start verifying with Accredifi today.

Disclaimer: This article is for informational purposes only and does not constitute financial advice.