Holding, trading or managing crypto-assets is not, in itself, an offence. But the practices surrounding their use — fundraising, management mandates, intermediation, conversion into fiat currency — expose individuals to several serious criminal classifications: fraud, breach of trust, money laundering, and the unlicensed exercise of a regulated activity. When an investigation opens, the tempo is set from the very first summons and, above all, from the first asset seizures. A useful crypto criminal defence begins with one question: what exactly is the prosecution targeting, and on what legal basis?
Which offences are involved?
Five classifications appear in almost every crypto case brought before the French criminal courts.
Fraud (escroquerie, Article 313-1 of the French Criminal Code) targets promises of returns, rug pulls, fake platforms, and misleading claims about a token‘s utility. It is the natural ground for the mass cases handled by the specialised prosecution offices.
Breach of trust (abus de confiance, Article 314-1 of the French Criminal Code) covers the misappropriation of digital assets entrusted under a mandate: a manager who disposes of an investor’s crypto outside the contract’s purpose, a platform that uses deposits for other ends. The Criminal Code punishes anyone who misappropriates, to the prejudice of others, funds, valuables or any property handed over to them and accepted subject to an obligation to return, present or use them in a specified way. The wording is broad enough to capture digital assets held on behalf of others.
Money laundering (blanchiment, Article 324-1 of the French Criminal Code) is very often layered on top of the first two: fiat/crypto conversion, use of mixers, address chaining, withdrawals via prepaid cards. Because the offence is autonomous, prosecutors can make it the lead charge when the predicate offence is hard to establish.
The unlicensed provision of digital-asset services — a PSAN under the regime created by the PACTE Act, a CASP under the EU Markets in Crypto-Assets Regulation (MiCA) — penalises the absence of registration or authorisation. The transition is precisely under way: Article L.54-10-1 of the French Monetary and Financial Code, which underpins the French definition of digital assets, is subject to deferred repeal as of 1 July 2026, as part of the shift to the unified European framework. In practice, this transitional period is one of heightened exposure: classification disputes concentrate in these gaps.
Tax fraud (Article 1741 of the French General Tax Code) and its laundering complete the picture, in particular where capital gains have not been declared under Article 150 VH bis of the Tax Code, or where the authorities have characterised the activity as professional without the corresponding registration.
What actually happens when an investigation begins?
The individual usually discovers the case at a voluntary interview or in police custody, sometimes directly through an early-morning search. In cases with an asset dimension, what unfolds beforehand has already shaped the defence: criminal seizures — of bank accounts, of wallets, value-based seizures — are ordered under Articles 706-141 et seq. of the French Code of Criminal Procedure, and may be imposed for the whole, without individualisation, from the investigation stage.
Three timeframes must be managed at once.
First, the interview or police custody, where the chronology of transactions, on-chain traceability, the origin of funds and the nature of any mandate weigh more than statements of intent. The technical exhibits — exchange records, wallet dumps, KYC documents — are rarely neutral: they frame the investigation.
Next, challenging the seizures, by appeal before the Investigating Chamber (Articles 706-148 and 706-150 of the Code of Criminal Procedure). This is where the proportionality of the measure and its individualisation — against the proceeds personally attributable to the person under investigation — are argued. The ground is often neglected, even though it determines the individual’s cash position for the rest of the proceedings.
Finally, managing assets, strictly within the judicial perimeter: preserving evidence, recovering wallets whose retention is unjustified, securing access pending a decision on the merits.
How is the defence built?
A crypto criminal defence is built, case by case, around three lines.
The factual line. Individualising the proceeds requires precise on-chain reading: who received what, when, through which address, under whose control. The technical traceability of crypto-assets, often relied on by the prosecution, is also an asset for the defence: it makes it possible to circumscribe what is personally attributable and to challenge value-based seizures ordered beyond that.
The legal line. Breach of trust requires a handover under a contract subject to an obligation to return or to a specified use: the absence of a mandate, or a disposal consistent with its purpose, defeats the classification. Fraud requires fraudulent manoeuvres that induced the handover: mere breach of contract or the technical hazard of a project is not enough. Money laundering, finally, requires knowledge of the unlawful origin of the funds: the defence then shifts to the defendant’s awareness and the economic coherence of the transactions.
The procedural line. Procedural nullities are often the most effective ground in technical cases. The lawfulness of the search and of the seizure of devices, the scope of the authorisation to access accounts, respect for defence rights during interviews, the quality of the investigative acts bearing on the cryptographic evidence: each of these points can bring down an entire section of the case.
What about the European dimension?
The MiCA Regulation unifies the status of crypto-asset service providers (CASPs) across the European Union. It reshapes the obligations of transparency, governance and anti-money-laundering, and strengthens cooperation between regulators. For operators established in France, the deadline calls for a compliance audit against the CASP authorisation threshold. For individuals already under investigation, MiCA is an additional interpretive lens the defence must anticipate: it can feed the argument on how foreseeable the applicable framework was at the time of the acts, as the former national provisions fade away.
Frequently asked questions
Is holding or trading crypto-assets an offence?
No. Holding, buying, selling and exchanging crypto-assets for one’s own account are not, in themselves, offences. Tax-reporting obligations — foreign-held accounts, capital gains under Article 150 VH bis of the French General Tax Code — and the registration or authorisation requirements for service providers are separate from criminal classification and follow their own rules.
What is a digital asset under French law?
Article L.54-10-1 of the French Monetary and Financial Code, in force until its deferred repeal on 1 July 2026, defines digital assets as the tokens referred to in Article L.552-2 of the same Code — excluding those qualifying as financial instruments — and any digital representation of value that is not issued or guaranteed by a central bank or public authority, is not necessarily attached to legal-tender currency, and can be transferred, stored or exchanged electronically. This definition expressly includes the crypto-assets governed by the MiCA Regulation.
My wallet has been seized: what can I do?
The seizure of a wallet, like any criminal seizure, can be appealed before the Investigating Chamber within the time limits set by Articles 706-148 and 706-150 of the French Code of Criminal Procedure. Review covers the lawfulness, proportionality and individualisation of the measure. Time is short: the defence must act from the moment of notification.
What does MiCA add to an ongoing case?
The Markets in Crypto-Assets Regulation harmonises the European framework for crypto-asset service providers. It does not retroactively remove earlier obligations, but it can be invoked to discuss the foreseeability of the legal framework applicable to the acts prosecuted and, where relevant, the evolution of professional obligations between the former PSAN regime and the new CASP regime.
What is the difference between fraud and breach of trust in a crypto case?
Fraud requires fraudulent manoeuvres that induced the handover (misleading advertising about the project, false credentials, an organised rug pull). Breach of trust requires a valid handover followed by misappropriation (a management mandate that is not respected, a deposit used outside its purpose). The line between the two classifications often determines the sentence incurred and the defence strategy.
References
- French Criminal Code, Article 314-1 (breach of trust)
- French Monetary and Financial Code, Article L.54-10-1 (definition of digital assets; deferred repeal 1 July 2026)
- Regulation (EU) 2023/1114 of 31 May 2023 on Markets in Crypto-Assets (MiCA)
Maître Mehdy Kadri is a member of the Paris Bar and the founder of Kadri Avocat (9 rue Boissy d’Anglas, 75008 Paris). Specialising in business criminal law and cybercrime, he acts in crypto-asset matters for the defence and in high-stakes criminal proceedings. The firm notably obtained, in 2025, before the Paris Judicial Court, the first acquittal handed down in France in a breach-of-trust case involving digital assets. He teaches at the Institut Catholique de Paris and publishes in the Encyclopédie Dalloz and AJ Pénal.
