Cardano released node version 11.1.1 ahead of its next major network era, completing the first of four planned node milestones supporting the Dijkstra hard fork.

Intersect’s container registry shows that version 11.1.1 was published during the weekend ending Sept. 6. The release removes Cardano’s legacy tracing system and addresses known Genesis-related issues. It also responds to increased memory use identified during testing of node 11.1.0.

The maintenance release arrived as Intersect published a more detailed Dijkstra schedule. Node versions 11.2 and 11.3, followed by the final protocol version 12 release, will progressively introduce the code required for testing and mainnet activation.

Intersect currently places a possible Dijkstra enactment between Dec. 5, 2026, and Jan. 4, 2027, under its “moderate confidence” timeline. A later “high confidence” window runs from Feb. 24 to March 26, 2027.

Those windows remain estimates. Cardano must complete development, public testing, ecosystem preparation and on-chain governance before the hard fork can activate.

Cardano node 11.1.1 begins the release sequence

Node 11.1.1 is available through Intersect’s official GitHub container registry. Intersect had previously targeted the week beginning Sept. 7, meaning the package appeared slightly ahead of that stated window.

The release does not activate the Dijkstra era or introduce the full set of planned ledger features. It is a maintenance and preparation update intended for current mainnet use.

Version 11.1.1 removes the older tracing infrastructure used to monitor node operations. Cardano’s development reporting also said it would address higher resident memory use observed in node 11.1.0 benchmarks.

The release registry includes standard, AMD64 and ARM64 versions. Availability across different processor architectures is relevant for stake pool operators and developers running Cardano infrastructure on varied hardware.

Node 11.2 is the next planned milestone. Intersect expects it within about one month of its Sept. 5 update. The version will contain most of the Dijkstra feature set for testing, but it will not be the final hard-fork candidate.

Leios components will be absent from node 11.2 because they primarily concern consensus and block production. Developers should still be able to test the remaining Dijkstra ledger and transaction features.

DijkstraNet will test Cardano’s new transaction features

Intersect plans to launch a public network called DijkstraNet after node 11.2 becomes available. The testnet will let developers, stake pool operators and tooling providers test the broader protocol version 12 feature set.

DijkstraNet is expected to include Plutus V4, Nested Transactions and CIP-50 parameters. Other ledger changes tracked in Cardano’s public development repository include new script types, address changes, block-body serialization revisions and changes to reward withdrawals.

Nested Transactions would allow one Cardano transaction to contain other transactions while preserving separate validation conditions. This structure could support more complex applications, coordinated actions and multi-party workflows without requiring every step to operate as an unrelated transaction.

Plutus V4 represents the next version of Cardano’s smart-contract language and execution environment. Testing will be needed to confirm that wallets, decentralized applications, indexers and developer tools correctly interpret the new ledger rules.

CIP-50 concerns pledge leverage and staking rewards. Its inclusion means stake pool operators will need to examine how new parameters could affect incentives and pool economics before mainnet activation.

The official Dijkstra readiness tracker remains open and marked as work in progress. It will close only after developers prepare a node capable of completing the hard fork into a functional Dijkstra era.

DijkstraNet will operate alongside MusashiNet rather than replacing it. MusashiNet is already live and concentrates on Leios, consensus and block-production testing.

This separation allows ledger features and the new consensus architecture to progress in parallel. Results must eventually converge in the node version selected as the hard-fork candidate.

Node 11.3 will combine Dijkstra with Linear Leios

Cardano node 11.3 is expected within one to two months, according to Intersect’s Sept. 5 update. It is intended to become the Dijkstra hard-fork release candidate.

Unlike node 11.2, version 11.3 is expected to contain the full Dijkstra feature set, including Linear Leios. It should also be capable of crossing from the current Conway ledger era into Dijkstra during test-network rehearsals.

Linear Leios is Cardano’s planned first-stage implementation of Ouroboros Leios. It adds parallel transaction-processing structures around the existing Praos consensus design. The goal is to increase throughput without replacing the security assumptions of Cardano’s base chain.

Testing must examine more than raw transaction capacity. Developers need to evaluate block propagation, network bandwidth, resource use, synchronization, recovery behavior and performance under adverse conditions.

Cardano node 12.0 will become the definitive protocol version 12 release under the project’s naming convention. Intersect has not assigned a publication date.

Intersect described the December-to-January period as a “moderate confidence” window, not a guaranteed activation date.

The organization’s later window, running from Feb. 24 to March 26, allows more time for testing and governance if the earlier schedule cannot be met. Neither window is a fixed hard-fork date.

As previously reported when Cardano published its phased Dijkstra roadmap, the year-end target originally referred partly to code completion. Mainnet activation remains conditional on technical readiness and community approval.

Governance must approve Cardano’s Dijkstra hard fork

Cardano cannot activate Dijkstra solely through a software release. The network’s on-chain governance system must approve the constitutional and hard-fork actions required for protocol version 12.

Some new Dijkstra parameters need to be incorporated into the Cardano Constitution’s guardrails before governance can modify them. Intersect has asked participants to monitor its Constitutional Amendment Portal for related proposals.

A constitutional change requires approval under Cardano’s governance rules. A separate hard-fork initiation action must then obtain the required support from delegated representatives, stake pool operators and the Constitutional Committee.

This process was tested during the van Rossem hard fork. As crypto.news reported following its July activation, van Rossem moved Cardano to protocol version 11 after completing the network’s full on-chain approval process.

Van Rossem remained within the Conway era but added Plutus changes and prepared technical foundations for Dijkstra. It was Cardano’s first mainnet hard fork enacted entirely through the current governance framework.

The Dijkstra transition will be broader because it changes the ledger era and introduces more extensive consensus, transaction and smart-contract capabilities. Exchanges, wallets, explorers and decentralized applications must be ready before activation.

Intersect is encouraging stake pool operators and developers to join MusashiNet and DijkstraNet testing. It has also scheduled node-diversity workshops in Singapore on Oct. 6 and London on Nov. 13 and 14.

Amaru, an alternative Cardano node written in Rust, forms another part of that preparation. It can already validate and synchronize with the chain tip, while mainnet block production remains targeted for November 2026.

Node diversity could reduce the network’s reliance on a single Haskell implementation. It also creates another testing requirement because alternative clients must interpret the protocol rules consistently.

Peras remains a separate 2027 upgrade

Cardano’s Dijkstra plan has two phases. Phase 1 covers the era transition, Nested Transactions and Linear Leios. Developers are targeting mainnet readiness around the end of 2026, subject to testing and governance.

Phase 2 will activate Ouroboros Peras through a separate intra-era hard fork. Intersect currently targets the second quarter of 2027.

Peras adds stake-based voting on recent chain tips to accelerate settlement. The design aims to provide stronger confirmation sooner than relying only on the normal chain-depth rules of Ouroboros Praos.

Phase 1 will install some of the codecs and protocol parameters needed for Peras. It will not activate the finality mechanism itself. Peras will require its own testnet deployments, readiness checks and governance action.

No verified ADA price movement could be attributed solely to the node release or Intersect’s revised windows. The roadmap provides measurable technical milestones, but the final activation date remains dependent on development and governance.

The next checkpoints are the adoption of node 11.1.1, release of node 11.2, public opening of DijkstraNet and publication of the required constitutional amendments. Node 11.3 will then determine whether Cardano is technically ready to rehearse the full era transition.

FAQs

XRP Ledger validators are moving closer to approving BatchV1_1, but live voting data on Sept. 8 showed the amendment remained below the threshold needed to begin its two-week activation period.

BatchV1_1 had support from 24 of 35 validators on the default Unique Node List, equal to 68.57%, according to XRPScan. At least 29 affirmative votes would be required to exceed 80% with the current validator count.

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Metaplanet CEO Simon Gerovich acknowledged on Sept. 6 that the company had not adequately explained its Series 10 executive option plan or the structure connecting him to major shareholder MMXX Ventures.

Gerovich said he is a “significant but non-majority shareholder” in MMXX’s parent company. He denied involvement in MMXX’s investment or trading decisions and said Metaplanet would provide clearer explanations of its corporate structure.

The statement followed renewed criticism of a compensation program that grew as Metaplanet issued shares to finance its Bitcoin treasury strategy. Metaplanet capped the plan at 319,464,000 potential shares on Aug. 18, but shareholders argue that the amendment stopped future expansion without addressing growth that had already occurred.

Gerovich exercised 92,000 Series 10 stock acquisition rights on Aug. 28. The exercise created 64,032,000 shares and increased his direct ownership to 79,587,500 shares, according to Metaplanet’s Aug. 31 disclosure.

The filing confirmed the exercise and resulting ownership. Separate claims about Gerovich’s total economic exposure through MMXX, however, remain shareholder calculations rather than figures confirmed by Metaplanet.

Metaplanet’s option pool expanded with its share count

Metaplanet established the Series 10 Stock Acquisition Rights program before adopting its Bitcoin treasury strategy. Its board approved the issuance terms on Dec. 28, 2022, and shareholders approved them at an extraordinary meeting on Feb. 7, 2023.

The company issued 460,000 rights to seven officers and employees. Each right initially represented 100 shares, subject to adjustments. Recipients paid ¥18 per right, while the exercise price was ¥10 per share.

The program did not grant a fixed number of shares. Its adjustment mechanism maintained the reward pool at roughly 20% of Metaplanet’s fully diluted share count. That structure allowed the number of potential reward shares to grow when the company issued additional equity.

Metaplanet began its Bitcoin treasury strategy in April 2024. It subsequently relied on shares, warrants and other financing instruments to fund purchases. New issuance diluted existing investors while also expanding the number of shares linked to the Series 10 rights.

In its Aug. 18 filing, Metaplanet acknowledged that the original adjustment mechanism had produced an unintended outcome.

The company said the mechanism “amplifies the dilution borne by existing shareholders.”

The board removed the floating adjustment and fixed the remaining potential issuance at 319,464,000 shares. The amendment prevents future capital raises from automatically enlarging the pool.

However, the board did not restore the pool to its size when Metaplanet adopted the Bitcoin strategy. Critics say that decision preserved hundreds of millions of potential shares accumulated through the adjustment mechanism.

A shareholder using the name Bitcoin Pharaoh calculated that 273 million of the potential shares resulted from adjustments after the treasury pivot. That figure has circulated broadly, but Metaplanet has not adopted it as an official company calculation.

Gerovich’s 64 million-share exercise raised scrutiny

Metaplanet’s Aug. 31 disclosure said Gerovich exercised 92,000 Series 10 rights effective Aug. 28. The rights converted into 64,032,000 common shares.

The exercise increased his direct holdings from 15,555,500 shares to 79,587,500 shares. Metaplanet placed the newly acquired shares under the five-year lock-up introduced through the Aug. 18 amendment.

That restriction generally prevents the sale or transfer of the shares until Aug. 17, 2031. Metaplanet said the lock-up was intended to align option holders with the company’s long-term performance.

The restriction reduces the prospect of an immediate sale, but it does not cancel the shares or reverse dilution. The 64,032,000 shares became part of the company’s issued equity when Gerovich exercised the rights.

Metaplanet’s Aug. 18 filing showed that Gerovich held 276,000 of the 459,000 unexercised Series 10 rights outstanding as of June 30. Two executive officers held 141,000 rights collectively, while two employees held another 42,000.

One-third of the rights vested on Feb. 8, 2026. The remaining tranches are scheduled to vest on Feb. 8, 2027, and Feb. 8, 2028. The exercise therefore represented only part of Gerovich’s disclosed Series 10 position.

Shareholders have asked why the company froze the enlarged pool instead of recalculating it from April 2024. Some have also requested a replacement incentive plan based on per-share performance, Bitcoin yield or other measurable targets.

Shareholder Ragnar argued that Metaplanet should “cancel the additional 273 million shares,” but the company has not accepted that calculation or proposal.

No filing reviewed for this story indicates that Metaplanet has decided to cancel the remaining rights. The company instead said existing holders intended to transfer part of their rights to a new long-term incentive vehicle involving officers and employees.

The amount, timing and ownership structure of that vehicle have not yet been fully disclosed.

Gerovich denies directing MMXX Ventures trades

MMXX Ventures is a disclosed Metaplanet shareholder. Gerovich said in his Sept. 6 statement that he owns a non-majority stake in its parent company.

He said he does not manage MMXX, make its investment decisions or direct its trading. He also described MMXX as separate from Metaplanet.

Gerovich said: “I have no involvement in its investment or trading decisions.”

That is an attributed denial. Public filings confirm connections between Gerovich and MMXX, but they do not provide a complete breakdown of every beneficial owner or show how proceeds from historical share sales were distributed among the parent company’s investors.

Metaplanet has previously disclosed Gerovich’s voting control in relation to MMXX. However, voting authority, legal ownership and economic benefit are separate questions. A person can influence voting without holding a majority economic interest, while a non-majority owner can still receive part of an entity’s profits.

Shareholder Bitcoin Pharaoh alleged that MMXX sold about 50 million Metaplanet shares during the company’s 2024 rally. The analysis was based on public ownership disclosures, according to its author.

Metaplanet has not publicly confirmed that total in a dedicated response to the current dispute. It also has not published a transaction-by-transaction account showing what portion of any MMXX sale proceeds may have benefited Gerovich.

For that reason, claims about Gerovich’s personal proceeds cannot be presented as established facts. His statement addressed decision-making authority but did not quantify his economic interest or identify the other owners of MMXX’s parent.

Gerovich acknowledged that the company’s previous communication was insufficient.

“We have not done a good enough job of explaining this clearly,” he said.

He promised more communication about the company’s decisions and long-term alignment. The post did not commit Metaplanet to publishing MMXX’s full ownership, cancelling rights or resetting the option pool.

Share-price decline increases pressure for fuller answers

Metaplanet shares traded near ¥255 on Sept. 8, down almost 6% during the Tokyo session, according to Google. The decline followed continued public discussion of the option structure and MMXX relationship.

The stock remains far below its June 2025 peak. Its decline has occurred even as Metaplanet expanded its Bitcoin holdings to 43,000 BTC.

As crypto.news reported when the shares approached a 52-week low, investors were already weighing dilution, Bitcoin valuation losses and the company’s ability to raise capital without weakening per-share value.

Metaplanet’s treasury strategy depends heavily on access to equity markets. Issuing stock can add corporate Bitcoin while reducing each existing shareholder’s percentage ownership. The result for shareholders depends on the issue price, the company’s valuation and how much Bitcoin or other value it creates per diluted share.

The governance dispute adds another concern because the Series 10 plan rewards insiders through the same expanding equity base used to fund Bitcoin purchases. Removing the automatic adjustment prevents that relationship from continuing, but the remaining pool can still produce further dilution as rights vest and are exercised.

The company has also committed 2,100 BTC and $2.5 million to a proposed U.S. Bitcoin treasury platform involving Nasdaq-listed Super League. As previously reported, those coins are expected to remain within Metaplanet’s consolidated group if the transaction closes.

That expansion gives the company a supported U.S. business angle, but it also makes clear governance and capital allocation more important. Shareholders must assess both Metaplanet’s Bitcoin exposure and the securities used to finance its wider strategy.

What happens next

Metaplanet has not announced a special review, independent investigation or vote concerning the Series 10 plan. No verified court or regulatory proceeding tied to the current criticism was found.

The next scheduled vesting date is Feb. 8, 2027. Additional Series 10 rights could become exercisable at that point unless Metaplanet amends, transfers or cancels them beforehand.

Investors are likely to watch for a filing explaining how many rights will move to the proposed employee incentive vehicle. They may also seek the vehicle’s ownership, governance rules, performance conditions and treatment under the five-year lock-up.

The larger unanswered questions concern MMXX. Gerovich has described his ownership and denied directing trades, but Metaplanet has not released a complete beneficial-ownership table for MMXX’s parent or a detailed account of Gerovich’s economic participation in its transactions.

Until the company supplies those details, shareholder estimates should remain clearly labelled as outside analysis. The official record currently confirms the option terms, the 319,464,000-share cap, the lock-up and Gerovich’s 64,032,000-share exercise. It does not settle every question raised about ownership and past economic benefits.

FAQs

Blockstream-backed Liquid has moved closer to resuming normal operations after a partial repayment tied to a Sunday security incident involving the network’s Bitcoin reserves. According to on-chain activity and statements from industry figures, purported “white-hat” actors returned 3,400 BTC—worth about $270 million—to the Liquid Federation wallet after withdrawing roughly $320 million from the Bitcoin sidechain’s reserve.

The return follows Monday comments from JAN3 CEO and former Blockstream executive Samson Mow, who said Blockstream confirmed that the affected bridge nodes had been patched. Mow added that approximately 598 BTC remains outstanding, while Blockstream continues direct engagement with the parties involved.

Key takeaways

• On-chain records indicate exactly 3,400 BTC was transferred back to the Liquid Federation wallet address after a prior withdrawal of about 4,000 BTC.
• Liquid remains paused as bridge-node fixes roll out, with federation members preparing for a coordinated restart.
• Blockstream says updated software has been deployed and that further issues—such as a chain split—must be fully resolved before resuming.
• Liquid’s backing depends on L-BTC issued against Bitcoin held by the federation; returning ~85% of withdrawn BTC restores much of the removed collateral.
• Mow advised users not to send Bitcoin to Liquid peg-in addresses until the restart is confirmed; there is no indication that user actions are otherwise required beyond that guidance.

3,400 BTC returned after bridge-node patch confirmation

In the hours after Sunday’s incident, the immediate focus turned to whether the withdrawn Bitcoin would be recovered. On-chain data shared via transaction records shows 3,400 BTC moved back to the federation’s wallet address, aligning with the portion of funds referenced by Mow and others. The earlier withdrawal had reduced the roughly 4,200 BTC reserve before the network was paused.

Mow said the return came after Blockstream provided confirmation that patch work on the affected bridge nodes was complete. He also stated that about 598 BTC is still not in the federation’s control. Meanwhile, he indicated Blockstream is continuing to work with the actors behind the initial withdrawal.

Liquid’s operational pause matters for more than just technical housekeeping. Liquid issues L-BTC against Bitcoin held by its federation; when reserves are reduced, the system’s ability to maintain full backing for issued tokens becomes strained. Restoring 3,400 BTC—about 85% of what was withdrawn—therefore meaningfully improves the collateral picture as the network prepares to restart.

Withdrawal originated from a SideSwap peg-out process linked to Elements

While the Sunday withdrawal proceeded through SideSwap’s Peg-out Authorization Key mechanism, both Liquid and SideSwap reportedly said the peg-out key itself was not compromised. Instead, SideSwap attributed the L-BTC involved in the incident to a bug in Elements, the open-source software that underpins Liquid.

Blockstream said it communicated with the actors using signed messages embedded in Bitcoin transactions. The actors claimed to be acting as “white hats” and indicated they would return most of the funds once vulnerabilities were fixed and all nodes installed the patch.

The recovery sequence also highlights how Liquid bridges operational decisions to Bitcoin-side verification. Even when a breach is connected to the Elements codebase, the real-time governance of funds still runs through federation wallet movements and chain-level confirmation—meaning the system’s restart readiness depends on both software deployment and the integrity of bridge operations across federation members.

Liquid remains paused; users told to avoid peg-ins

Liquid has not yet returned to full service. Mow stated that the network stayed paused while additional fixes and security improvements were completed. He also referenced resolution of a chain split and preparations for a “safe restart” coordinated across federation participants.

Crucially for day-to-day users, Mow advised against sending Bitcoin to Liquid peg-in addresses until Blockstream confirms the restart. He framed this as the primary action users should take—or rather, avoid—during the pause, adding that no other user step was otherwise required.

This kind of instruction is significant because peg-in workflows depend on the bridge operating correctly and on the federation continuing to manage the custody and issuance relationship between Bitcoin reserves and L-BTC. Until a confirmed restart, directing funds to peg-in addresses carries the risk of stuck or delayed handling, even if no further compromise occurs.

Dispute over “white-hat” framing after partial return

The partial repayment has not fully ended debate about intent and legitimacy. Ledger chief technology officer Charles Guillemet questioned the “white-hat” label, arguing that if the remaining ~600 BTC represented a reward negotiated via encrypted on-chain communications, the arrangement could resemble extortion rather than conventional vulnerability disclosure.

At the same time, neither Blockstream nor Liquid publicly characterized the outstanding Bitcoin as a bounty, nor were any repayment terms disclosed. Cointelegraph reported outreach to both companies for comments but said it did not receive a response before publication.

That lack of transparency creates uncertainty for observers trying to interpret the actors’ motivations. Even when funds are returned, the unresolved portion can shape how the industry weighs the incident—whether it is treated as an expedited remediation coordinated through responsible disclosure norms, or as leverage applied through disruption.

Readers will likely look for confirmation from Blockstream on the remaining issues holding Liquid in a paused state—especially after software deployment and the claimed resolution of a chain split. The next checkpoints are straightforward: a confirmed restart, continued monitoring of federation reserve movements, and clarity on whether the outstanding ~598 BTC is fully recovered.

Chainalysis estimated on Aug. 26 that France generated about $9.4 billion in potentially taxable crypto activity during 2025, placing the country among the world’s 15 largest markets covered by its latest crypto tax study.

The estimate included $1.7 billion in crypto income, $2.5 billion in realized gains and $5.2 billion in crypto payments. It arrives as France prepares to receive detailed customer and transaction data under the European Union’s DAC8 tax reporting system and the OECD’s Crypto-Asset Reporting Framework, or CARF.

Chainalysis described the figures as “potentially taxable activity,” rather than unpaid taxes or government revenue. Tax treatment varies by transaction type, taxpayer status and national law. Crypto payments, for example, cannot be treated as equivalent to undeclared capital gains.

The company also did not estimate that more than 90% of French crypto taxes went unpaid. Its reference to non-compliance above 90% came from a Swedish tax authority study concerning taxpayers in Sweden. Applying that rate directly to France would not be supported by the available evidence.

Chainalysis estimates France generated $9.4B in activity

The Chainalysis study estimated that potentially taxable on-chain crypto activity reached at least $457 billion worldwide in 2025. The United States led individual countries with $112.6 billion, while the European Union collectively accounted for $125.1 billion.

France ranked 13th among the countries listed in the study. Its estimated $9.4 billion total consisted of three separate categories: income, gains and payments. Chainalysis included mining, staking, lending and gambling proceeds within income. Its gains category covered activity attributed to centralized and decentralized exchanges.

Payments included transfers linked to merchant services and peer-to-peer economic activity. Such activity may create different income tax, capital gains tax or indirect tax questions depending on the circumstances. The full $9.4 billion therefore does not represent a taxable profit figure or an estimate of tax owed.

Chainalysis produced the estimates using activity across Bitcoin, Ethereum, Solana, Tron, BNB Smart Chain and Base. It assigned activity geographically through direct location indicators and proportional allocations based on service-level activity.

The company acknowledged that trading, staking and lending conducted within centralized exchange systems cannot always be observed on a public blockchain. It said this limitation means its estimates may understate total economic income.

Chainalysis called the figures “potentially taxable activity.” They should not be read as confirmed unpaid taxes or recoverable government revenue.

The report compared its broader estimates with public evidence of weak crypto tax reporting. It cited Sweden’s tax authority, which previously found that more than 90% of people reviewed had not correctly reported their crypto activity. That finding concerns Sweden and does not establish France’s non-compliance rate.

French data nevertheless show a wide difference between declared gains and estimated activity. Approximately 24,000 taxpayers reported €368 million in crypto capital gains for tax year 2024, according to figures attributed to the French tax administration. However, that declared amount covers a different year and a narrower category than Chainalysis’ $9.4 billion estimate.

A direct comparison would also mix euros with dollars. More importantly, it would compare declared net capital gains with gross activity spanning income, gains and payments. The figures indicate an enforcement question, but they do not measure the French crypto tax gap on a like-for-like basis.

France’s crypto tax reporting changes under DAC8

DAC8 took effect across the EU on Jan. 1, 2026. Reporting crypto-asset service providers must now collect information covering reportable transactions conducted by EU-resident users.

Required customer information can include names, addresses, tax identification numbers, dates of birth and tax residences. Providers must also report aggregated values and transaction counts for exchanges, transfers and certain payments.

The European Commission says providers began collecting reportable 2026 transaction data on Jan. 1. Reports covering that first year must be exchanged between EU tax authorities by Sept. 30, 2027.

As previously reported in coverage of the new EU rules, DAC8 covers crypto-to-fiat trades, crypto-to-crypto exchanges and transfers involving external addresses. A withdrawal to self-custody can therefore appear in a provider’s report even though self-custody itself is not prohibited.

The underlying directive also requires providers to collect tax-residency self-certifications. Existing individual users generally must provide valid self-certification information by Jan. 1, 2027.

If a customer fails to provide required information after two reminders, member states must require providers to prevent reportable transactions after a 60-day period. National implementation, enforcement procedures and penalties can still differ.

CARF extends a similar exchange model beyond the EU. The OECD expects the first exchanges between participating jurisdictions to begin in 2027. France is among the jurisdictions committed to that timetable.

Reporting rules still leave most on-chain activity outside direct reach

Chainalysis estimated that transactions falling within CARF’s practical reporting reach represented only 14% of the potentially taxable on-chain activity it identified. The remaining 86% involved areas such as decentralized exchanges, peer-to-peer transfers, on-chain income and payments.

CARF and DAC8 primarily obtain information from reporting service providers. Centralized exchanges and brokers can link transactions to verified customer identities because they maintain account records and normally conduct know-your-customer checks.

Decentralized protocols may not have an operator holding the same identifying information. A taxpayer can also use several private wallets, interact directly with smart contracts or move assets between services in different jurisdictions.

Public blockchains record transfers, but they do not automatically identify the taxpayer, establish the purpose of a transaction or calculate the correct cost basis. A wallet transfer could represent a sale, a payment, collateral movement or a transfer between addresses controlled by the same person.

Cost-basis records become harder to reconstruct when a user buys an asset through one provider, moves it through private wallets and later sells through another provider. The receiving exchange may know the sale proceeds without knowing the original purchase price.

In related coverage of the Chainalysis findings, crypto.news reported that platform reporting may need to be combined with blockchain records to reconstruct activity involving DeFi and private wallets.

The report’s 86% estimate does not mean that activity will remain invisible or untaxed. It means it may not be directly described in reports supplied by intermediaries. Tax agencies can still use exchange records, blockchain analysis, audits and information obtained from other jurisdictions.

What happens next for French taxpayers and providers

Crypto service providers must continue collecting reportable customer and transaction data throughout 2026. They must also verify tax-residency declarations and prepare the first annual reports for submission during 2027.

France’s tax authority will then be able to compare provider reports with domestic tax returns and data received from other EU states. CARF exchanges could add information from participating jurisdictions outside the bloc.

The new system will not retroactively produce complete histories for activity conducted before the reporting period. Authorities may still need account statements, wallet records and blockchain analysis when reviewing historical gains or reconstructing acquisition costs.

Taxpayers remain responsible for maintaining records showing purchases, disposals, income and transfers. A transaction appearing in a DAC8 report does not by itself determine the amount of French tax due. The tax calculation still depends on French law and the taxpayer’s circumstances.

FAQs

Purported white-hat hackers returned 3,400 Bitcoin worth about $270 million to the Liquid Federation wallet after withdrawing roughly $320 million from the Bitcoin sidechain’s reserves. 

On Monday, JAN3 CEO and former Blockstream executive Samson Mow said the return followed confirmation from Blockstream that the affected bridge nodes had been patched. He said about 598 BTC remains outstanding and that Blockstream continues to engage with the actors.

The return follows a Sunday security incident in which hackers withdrew about 4,000 BTC from the wallet’s roughly 4,200 BTC. Onchain records show that exactly 3,400 BTC was transferred back to the federation’s wallet address. 

Blockstream said updated software had been deployed and federation members were preparing for a coordinated restart. Liquid issues L-BTC against Bitcoin held by its federation, so the return of about 85% of the withdrawn Bitcoin restores much of the backing removed in the incident as the paused network prepares to resume operations. 

Bitcoin return follows onchain negotiations

The original withdrawal was processed through SideSwap’s Peg-out Authorization Key, although Liquid and SideSwap said the key itself was not compromised. SideSwap said the L-BTC involved originated from a bug in Elements, the open-source software underpinning Liquid. 

Blockstream contacted the actors through signed messages embedded in Bitcoin transactions. The actors, who identified themselves as white hats, said they would return most of the funds once the vulnerability was fixed and every node had installed the patch. 

Related: Satoshi-era Bitcoin wakes after 16 years of dormancy as 600 BTC moves

Mow said Liquid remained paused while Blockstream and federation members made further fixes and security improvements, resolved a chain split and prepared for a safe restart. He told users not to send Bitcoin to Liquid peg-in addresses until the network’s restart is confirmed, adding that no user action was otherwise required. 

Ledger chief technology officer Charles Guillemet questioned the actors’ white-hat description after the partial return. He said that if the roughly 600 BTC still under their control represented a reward negotiated through encrypted onchain communications, the arrangement looked “more like extortion than white-hat hacking.”

Neither Blockstream nor Liquid publicly described the outstanding Bitcoin as a bounty or disclosed any repayment terms. Cointelegraph reached out to both companies for comments but did not receive a response before publication. 

Magazine: ‘White hats’ take 4000 BTC from Liquid, ETFs see best inflows of 2026: Hodler’s Digest