From 1 January 2026, the Eighth Amendment to the Administrative Cooperation Directive (DAC8) has entered into force in the European Union (EU). This marks a milestone in the oversight of Bitcoin (BTC) and cryptocurrencies.
However, various experts argue that it is a misunderstanding of the law to describe the measure as the “end of privacy” for cryptocurrencies in Europe.
This is because, although the regulation imposes an unprecedented automatic exchange of information between member states, Its scope of action is limited to centralized organizations. Therefore, the private and sovereign nature of those who use Bitcoin technology directly remains intact.
The independent journalist and security analyst known as L0la L33tz on social networks is one of the most critical voices denying the regulatory catastrophe.
According to the expert, “DAC8 is very bad, but the European Union has not ‘officially ended crypto privacy with DAC8’ nor does it ‘definitively end the anonymous crypto holdings of all residents of member states.’” For analysts, The fundamental difference lies in who holds the private keys of digital assets.
The core of the risk under this law is the automatic exchange of international data. L33tz explains that “DAC8’s main concern is with automated international information exchange.”
“This means governments where their nationals belong to countries with questionable human rights, such as Turkey and the United Arab Emirates, which are signatories to the CARF framework governing DAC8.” Receive all transaction details automatically This is what the user does abroad,” the expert warns.
However, he clarified that non-custodial software “should be used where privacy is needed in the first place and is not affected at all.”
Suppliers have an obligation to provide information
In fact, CriptoNoticias reports that this regulation is already in force, requiring digital asset service providers such as exchanges to report users’ transactions to tax authorities. This includes selling, exchanging, and transferring cryptocurrencies.
In Spain, the effects will be immediate. “From 2027, we will have information on all movements made during 2026,” said tax advisor José Antonio Bravo Mateu. “It will be almost complete information,” he asserts.
Bravo emphasizes that the depth of the report goes beyond even traditional banking systems. This is because with digital assets, “you can’t get away with exchanging 2 euros for digital currency.”
Furthermore, experts warn that under this framework, “if you have digital assets or euros on exchanges located in Spain, they could be directly seized.” He emphasizes that this “doesn’t require any complicated preliminary procedures.”
There’s another way to protect your Bitcoin and cryptocurrency privacy
Despite this surveillance scenario, Bitcoin’s resistance to censorship It is still used outside of centralized platforms.
L0la L33tz claims that “DAC8 only applies to escrow services, and escrow services are not privacy services.” Under this assumption, it is possible to acquire Bitcoin through person-to-person (P2P) methods or use privacy tools such as mixers. These remain legal means of maintaining anonymity.
In this regard, Bravo Mateu argues that: It is not illegal to purchase Bitcoin privately. “You can buy Bitcoin P2P, just like you can buy all kinds of goods from individuals. If it’s not done on a regular basis, it’s not a crime and there’s no economic activity going on,” he explains.
Experts also examine the use of anonymous tools. He states that “taking assets to the mixer is not a crime.” Unless it becomes a repetitive economic activity It must tax itself.
But the privacy outlook is not without indirect dangers. Starting in 2026, tax authorities could use metadata access and legal pressure to seize funds.
Therefore, even if the keys are protected through self-storage, the state may apply penalties of up to 150% of the value evaded. It also requests that assets related to stablecoins managed by private companies, such as USD Tether (USDT), be frozen.
In any case, DAC8 builds a surveillance network on a regulated ecosystem, but Bitcoin financial sovereignty remains accessible. This is especially important for those who choose to operate outside of a financial intermediary.