Tax-Compliant Reporting for Immediate Exchanges

Technical crypto swap: You don’t lose your holding period!

If you trade crypto assets, you may have already done a technical swap,  exchanging a crypto asset for a stablecoin quickly and immediately. The good news is that, in Portugal, this operation does not reset your holding period, meaning you don’t lose the long-term capital gains tax advantage.

Why?

The Portuguese Tax Authority (“Autoridade Tributária”) considers that a technical swap, done almost instantly, does not constitute an actual sale. Therefore, the holding period of the original asset continues uninterrupted. If you’ve held it for more than 365 days, the capital gains upon the final sale remain exempt from personal income tax (IRS). More information available here.

Binding opinion from the Tax Authority

This interpretation is confirmed in the Binding Opinion of the Tax Authority (Process 28969, ruling dated 31/10/2025), which clarifies that immediate technical swap operations do not trigger taxable events nor break the asset’s holding period.

In practice:
Imagine this scenario:

• You bought a crypto asset more than a year ago.

• You perform a technical swap into a stablecoin (like USDC) immediately, merely to simplify the sale.

• Immediately, you sell the stablecoin for euros.

Even in this case, the law treats your original asset as having been held for over a year, so the final sale in EUR(€) remains tax‑exempt, provided you meet the 365‑day holding period.

In summary:

• Immediate technical swap → does not harm the holding period.

• Taxation occurs only upon the final sale into fiat currency, if the asset was held for more than 365 days, thus benefiting from the exemption.

If you want to manage your crypto operations safely from a tax perspective, this guidance confirms that you can perform technical swaps without losing the holding‑period benefit.

Practical example – preserving your holding period in a technical swap

Let’s imagine the following situation (image 1):

• On 01/01/2024 at 12:00:00, you deposit EUR into your exchange account (1).

• On 01/01/2024 at 12:01:00, you trade EUR for BTC (2).

Later, you decide to convert your BTC to fiat (EUR), but your exchange doesn’t support the BTC/EUR pair anymore. To proceed, you perform a technical swap (image 2):

• On 02/01/2025, 12:00:00, you swap your BTC → USDC (1).

   

• Then, on 02/01/2025, 12:01:00, you exchange your USDC → EUR (2).

   

Because the swap from BTC to USDC and then to EUR happens almost instantly, it qualifies as a technical swap and does not reset your holding period (image 3).

Here’s what that means in practice:

• The BTC bought on 01/01/2024 has been held for more than 365 days, so the gains are exempt from taxation.

To make the reporting process easier, DAX Ledger automatically generates a detailed report of all taxable events (image 4), including realized gains, holding periods, and fiat conversions.
This report provides all the necessary information to complete your IRS form accurately, ensuring that your crypto taxes align with Portuguese regulations and that you retain the full benefit of long‑term holding exemptions.

Note: This interpretation and tax treatment apply exclusively under Portuguese tax law.

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