Automatic crypto reporting, self-custody, perpetual futures and the line between investor and professional trader
YARD Law Co. · Legal status checked 28 August 2026
On 27 August 2026 the Bulgarian Parliament adopted at first reading the amendments to the Tax and Social Security Procedure Code that are intended to implement the EU's DAC8 crypto-reporting rules. The vote was 136 in favour, 4 against, 10 abstentions.
This article sets out what actually changed, who is reported, how self-custody and Hyperliquid alter the evidence trail rather than the tax, and the question that matters most for active traders: the line between investor and trader. For the underlying rate and computation, see our guide to crypto tax in Bulgaria.
On 27 August 2026 the Bulgarian Parliament adopted at first reading amendments to the Tax and Social Security Procedure Code intended to implement DAC8. The bill had been introduced by the Council of Ministers on 7 May 2026.
As of 28 August 2026, Bulgaria's DAC8 implementing bill has been approved only at first reading. It is not yet final law. The EU reporting framework nevertheless identifies 2026 as the first crypto reporting period, and Bulgaria's current bill is expressly designed to capture periods beginning on 1 January 2026.
That distinction matters. Because the bill is not yet enacted or promulgated, its Bulgarian wording may still change at second reading. It would be legally sloppy to write that the NRA already receives every Bulgarian resident's crypto data under the new domestic provisions.
What is already fixed at EU level is the direction and the timetable. Council Directive (EU) 2023/2226 (DAC8) requires annual reporting and automatic exchange of specified crypto-asset information. The Directive provides that the first information relates to reporting periods beginning on 1 January 2026, and that Member State authorities communicate the data within nine months after the end of the relevant calendar year.
Bulgaria is late in transposing the Directive. The current draft expressly states that the first information under the new crypto-reporting article concerns periods starting from 1 January 2026, while the explanatory memorandum indicates that providers are intended to report the first 2026 dataset to the NRA by 30 June 2027.
For an individual genuinely investing on their own account, and not carrying on a business, the NRA's current guidance applies Article 33(3) of the Personal Income Tax Act (PITA) to the sale or exchange of crypto-assets.
In simplified terms: take the sum of realised gains on individual transactions, subtract the sum of realised losses for the year, then apply the statutory 10% expense deduction. The resulting amount enters the general annual tax base, taxed at 10%. Where Article 33(3) applies and the annual net result is positive, that is mathematically equivalent to roughly 9% of the net result before any other annual-base adjustments.
The income is declared in Appendix 5 to the annual personal income tax return, normally by 30 April of the following year. The important qualification is that this simple investor model disappears if the facts support treating the person as a trader carrying on a business.
The legal change is mainly about visibility and third-party verification. Bulgarian crypto profits did not become taxable on 27 August 2026 — they were taxable before that date.
Media headlines often say the NRA will receive information about "Bulgarians" trading crypto. That is convenient shorthand, but it is not the legal test. DAC8 is built around the jurisdiction of tax residence, identified through due diligence and self-certification.
For internationally mobile crypto traders, residence analysis is therefore not an administrative detail. It determines which country claims worldwide taxing rights and which authority is expected to receive the automatic report.
The framework is broader than a simple notice that "this person has an exchange account". The report includes identifying information — including tax residence and tax identification data — and annual transaction information, generally aggregated by crypto-asset and transaction category.
| Category | Typical reported information |
|---|---|
| Crypto bought for fiat | Aggregate gross amount paid, units and transaction count |
| Crypto sold for fiat | Aggregate gross amount received, units and transaction count |
| Crypto-to-crypto exchanges | Aggregate fair market value, units and transaction count |
| Reportable transfers | Aggregate value, units and transaction count, depending on category |
| Certain transfers to external DLT addresses | Information intended to capture transfers to addresses not known to be associated with another qualifying provider or financial institution |
This is important, but it is not a complete Bulgarian tax computation. A provider's annual report does not necessarily give the NRA every fact needed to establish statutory acquisition cost, beneficial ownership history, or the tax classification of every DeFi interaction.
The enforcement power comes from matching. If a tax return shows little or no crypto income while third-party reporting shows substantial disposals, swaps or transfers, the NRA has a clear reason to ask for the underlying ledger and supporting evidence.
With a conventional KYC exchange the evidentiary chain is comparatively straightforward: name, tax residence, tax identification number, exchange account and transaction aggregates. An exchange established in another EU Member State does not solve this, because the entire point of DAC8 is automatic exchange between tax administrations.
The same direction exists outside the EU through the OECD Crypto-Asset Reporting Framework (CARF). Bulgaria's CARF Multilateral Competent Authority Agreement entered into force for Bulgaria on 22 April 2026. That does not mean every country in the world automatically sends information to Bulgaria — an effective exchange relationship and implementing domestic rules are still required. But the architecture is deliberately international, not merely European.
People looking for a blind spot naturally ask about platforms such as Hyperliquid. There is a grain of truth here, but not the one usually advertised in Telegram groups.
Hyperliquid's own technical documentation describes HyperCore as maintaining fully on-chain spot and perpetual order books: orders, cancellations, trades and liquidations occur transparently on the Hyperliquid blockchain. The user interacts through a wallet address rather than the conventional custodial account structure of a centralised exchange.
That can create a practical difference. A self-custodial wallet interacting with an on-chain venue may not produce the same ready-made file saying, in effect, "John Smith, Bulgarian TIN X, sold Y BTC" that a KYC exchange can produce. The identity link can be less automatic, and the evidentiary work for the NRA harder.
That is friction, not invisibility. The underlying Hyperliquid activity is public on-chain. If an address can be linked to a taxpayer through a KYC exchange, a bank transfer, a disclosure, audit evidence or another reliable attribution point, the intermediate on-chain activity can potentially be reconstructed.
Nor does "non-custodial" automatically mean "outside DAC8/CARF". OECD guidance expressly states that providers of non-custodial services, including services provided in a decentralised manner, can fall within the definition of a Reporting Crypto-Asset Service Provider. For trading platforms, the critical question is whether an identifiable person or entity exercises sufficient control or influence to perform the relevant due-diligence and reporting functions.
That is precisely why it would be premature to state categorically that Hyperliquid either does or does not have a DAC8/CARF reporting obligation for Bulgarian users in 2026. We have not identified a public Hyperliquid statement confirming that it currently files named DAC8/CARF reports for Bulgarian tax residents. The legal classification of a decentralised platform or operator remains fact-sensitive, and the OECD continues to develop guidance in this area.
| Question | KYC centralised exchange | Hyperliquid / self-custodial route |
|---|---|---|
| Does the venue normally hold name, TIN and tax-residence data? | Usually yes, subject to its KYC and tax onboarding. | Not necessarily in the same account-based form. |
| Can DAC8/CARF apply? | Yes, where the provider is within the reporting rules. | Potentially. Non-custodial or decentralised operation is not an automatic exemption. |
| Is trading activity publicly visible on-chain? | Often only deposits and withdrawals are directly public; internal order history is venue data. | Yes. HyperCore order, trade and liquidation activity is on-chain. |
| How hard is identity attribution? | Usually relatively low once the account is reported. | Potentially higher if the wallet is not already linked to a person — but straightforward once a reliable link exists. |
| Does the tax obligation change? | No. | No. |
A typical evidentiary path illustrates the point: bank → KYC exchange → USDC or crypto → self-custody wallet → Hyperliquid → wallet → KYC exchange → bank. The middle of that chain may not arrive at the NRA as a pre-packaged identity report. The entry and exit points, however, may supply the identity bridge to an otherwise public blockchain history.
Using a DEX or self-custody for privacy is not itself unlawful. Deliberately providing false tax-residence information, disguising beneficial ownership, or structuring transactions to evade a legal reporting or tax obligation is a different matter, and can create additional tax, procedural and AML risk.
Another common mistake is to treat only a fiat cash-out as taxable. Article 33(3) refers to the sale or exchange of crypto-assets, and DAC8 reporting similarly covers crypto-to-crypto exchange transactions.
A BTC → ETH or ETH → USDC swap can therefore create a realised tax result even though no euros reached a bank account. The relevant acquisition and disposal values must be reconstructed transaction by transaction. This becomes particularly important for users who move assets through several exchanges and wallets before ultimately cashing out.
Much of the activity on Hyperliquid is in perpetual futures ("perps"), not spot crypto. Hyperliquid describes these as derivative contracts without an expiry date, with funding payments and margining in USDC.
A perpetual position is therefore not simply ownership and later sale of the underlying BTC, ETH or other token. The trader holds a derivative exposure, and that changes the legal analysis.
Article 33(3) PITA is broader than crypto-assets alone: it also covers "other financial assets". There is a strong basis for analysing a personally held perpetual derivative within that broader financial-asset framework where the activity is not a business, but the precise qualification depends on the contract and the facts. An NRA opinion of 18 August 2021 (ref. 24-39-71) expressly considered Bitcoin trading together with derivatives and perpetual swaps on crypto exchanges, and the interaction between Article 33(3) and Article 26(7). The publicly accessible copy notes that the opinion was principle-based because the underlying enquiry was hypothetical and anonymous; it should not be treated as a binding ruling for Hyperliquid.
| Perp event | Tax analysis for a private investor — practical starting point |
|---|---|
| Opening a leveraged position | The notional exposure is not itself income. Opening establishes the derivative position and margin exposure. |
| Unrealised P&L on an open position | A screen-level mark-to-market movement is not automatically the same thing as a realised sale or settlement. The contractual mechanics matter. |
| Closing or reducing a position | The realised economic P&L is the central amount that must be analysed for the annual tax result. |
| Liquidation | Liquidation closes or settles exposure and can crystallise an economic result; preserve the liquidation and settlement records. |
| Funding payments | Funding is a separate derivative-related cash flow. Preserve received and paid funding data; its treatment should be reconciled consistently with the instrument's overall classification. |
| Trading fees | Preserve them. Under the ordinary Article 33 regime the statute already applies a 10% deemed-expense deduction, while a business regime follows accounting and CITA rules instead. |
The practical mistake to avoid is calculating tax on the headline leveraged notional. A 20x position with €1 million of notional exposure does not mean the individual received €1 million of taxable income. The tax file needs the realised P&L, settlements, funding and transaction records — and then the correct legal classification.
This is the part of Bulgarian crypto tax law that matters most for active traders, and it is often reduced online to an invented threshold such as "X trades per month". There is no statutory safe harbour based on a fixed number of trades, euro turnover or portfolio size.
Article 1(3) of the Commercial Act treats as a trader a person who has formed an enterprise which, by its subject and volume, requires its affairs to be conducted in a commercial manner. Article 26(7) PITA then applies the sole-trader business-tax rules even if the individual never registered as a sole trader.
The classification is therefore factual. The venue — Binance, Kraken, Bybit, Hyperliquid or another DEX — is not decisive. What matters is what the person is actually doing.
| Indicator | More investment-like | More business-like / trader risk |
|---|---|---|
| Frequency and continuity | Occasional, irregular disposals | Daily or near-daily systematic activity over a sustained period |
| Strategy | Long-term portfolio management | Repeated short-term speculation, market-making or systematic strategy execution |
| Leverage and derivatives | Limited or incidental | Regular use of leveraged perps, short positions and margin as a core activity |
| Automation | Manual and occasional | Bots, APIs, algorithmic execution, multiple subaccounts or automated risk controls |
| Organisation | No separate operational structure | Dedicated systems, records, dashboards, capital allocation and procedures |
| Economic role | Side investment activity | Primary or significant organised source of income |
| Scale | Large value can still be passive | High turnover and notional, plus repetition and organisation, strengthens the business character |
None of these indicators is individually conclusive. One very large BTC sale does not automatically make someone a trader. Conversely, a smaller account running hundreds of leveraged automated transactions every week can look much more like an enterprise. Perpetual trading is relevant evidence because it often comes with leverage, frequent execution and organised risk management — but perps alone do not automatically trigger Article 26(7).
This can be more important than DAC8 itself. The same trading history can produce a different tax base, rate, deadline, record-keeping burden and social-security exposure, depending on whether the activity is legally an investment or an enterprise.
| Issue | Private investor — Art. 33(3) PITA | Trader — Art. 26(7) PITA |
|---|---|---|
| Tax base | Annual realised gains minus realised losses, then a 10% statutory expense deduction | Tax profit determined under the rules applicable to business activity, based on accounting result and CITA adjustments |
| Tax rate | 10% general personal income tax | 15% on the annual business tax base |
| Approximate headline effect | Where Art. 33 applies and the annual net result is positive, the deemed-expense mechanism gives roughly 9% of that net result before other adjustments | No automatic 10% deemed-expense deduction; documented expenses and tax adjustments become relevant |
| Annual return | Appendix 5 | Appendix 2 |
| Normal filing deadline | 30 April of the following year | 30 June of the following year |
| Accounting burden | Transaction evidence sufficient to substantiate the Art. 33 calculation | Business accounting, books and tax-profit reconciliation become relevant |
| Social insurance | Ordinary disposal income does not by itself make the person a self-insured trader | If the person exercises labour activity as a trader, self-insurance obligations can arise under the Social Security Code |
| Sole-trader registration needed first? | Not applicable | No. Article 26(7) expressly reaches a person who is a trader under the Commercial Act without ET registration |
For a Hyperliquid perp trader, always separate two questions:
A gap in automatic platform reporting does not create a tax exemption. Equally, the existence of an on-chain record does not automatically tell the NRA the correct tax base. Identification, legal classification and calculation remain distinct steps.
| Date / period | What matters |
|---|---|
| 1 Jan – 31 Dec 2026 | First DAC8 crypto reporting period under the EU framework; the Bulgarian draft is intended to capture periods starting 1 January 2026. |
| 30 Apr 2027 | Normal deadline for a private individual's 2026 annual return where Appendix 5 and Art. 33 apply. |
| 30 Jun 2027 | Current Bulgarian draft explanatory materials identify this as the intended deadline for providers to submit the first 2026 crypto dataset to the NRA; trader returns under Appendix 2 are also normally due by 30 June. |
| By end-Sep 2027 | DAC8 provides for communication between Member State authorities within nine months after the end of the reporting year. |
The sequencing is deliberate: the taxpayer declares first, third-party data arrives later, and the administration can compare the two.
DAC8 does not create an automatic historical feed covering every crypto transaction from 2020 onward. Its first reporting period begins in 2026. But 1 January 2026 is not an amnesty date.
Earlier undeclared taxable income remains subject to the ordinary Bulgarian rules on assessment, evidence, limitation, interest and administrative enforcement. The NRA also has information-gathering powers independent of DAC8. Anyone with material historical exposure should review those years separately rather than assuming pre-2026 activity has disappeared.
The goal is not to produce as much data as possible. It is to be able to answer three questions cleanly: what happened, who owned the assets, and why the declared tax result follows from the evidence.
For most Bulgarian tax residents, DAC8 changes the probability of detection, not the existence of the tax. Centralised exchanges make identity matching comparatively easy. Hyperliquid and self-custody can create more evidentiary friction, because the middle of the transaction chain may not come with a ready-made name-and-TIN report — but the trades themselves are public, and a KYC entry or exit point can supply the missing identity link.
For active perp traders the bigger hidden risk may be different: the NRA may challenge the assumption that the person is merely an investor. Once the factual pattern starts to resemble an organised enterprise, the 15% business regime, accounting rules, Appendix 2 and self-insurance issues can matter more than whether the platform itself filed a DAC8 report.
If your 2026 crypto activity includes substantial exchange turnover, Hyperliquid or perpetual trading, multiple wallets or cross-border residence, the useful exercise is a pre-filing reconciliation before the 2027 return — not an explanation after an NRA information request arrives.
Where the relevant provider falls within the DAC8/CARF reporting rules, the system is built around tax-residence-based reporting and cross-border exchange. The exact provider entity and its jurisdiction should be checked rather than assumed.
This review identified no public basis for stating categorically that Hyperliquid currently files named DAC8/CARF reports for Bulgarian users. But non-custodial or decentralised status is not an automatic CARF exemption, and Hyperliquid trading activity is publicly recorded on-chain.
A self-custody wallet is not automatically a tax account registered in your name. The decisive question is attribution. Once an address is reliably connected to you, the public blockchain activity behind it can potentially be analysed.
A Bulgarian tax resident's realised derivative profits are not made tax-free merely because the position sits on-chain. Perpetuals are derivative contracts, so their classification under the Personal Income Tax Act should be analysed separately from spot crypto. The investor-versus-trader question can change the result materially.
There is no fixed trade count or euro threshold. The test under Article 1(3) of the Commercial Act looks at the subject and volume of an organised activity and whether it requires the person's affairs to be conducted in a commercial manner. Frequency, continuity, leverage, automation and organisation are factual indicators, not automatic statutory tests.
Yes. Under the ordinary Article 33 framework a sale or exchange can generate a realised result. A fiat withdrawal is not the only relevant event.
The first DAC8 crypto reporting period begins on 1 January 2026. That does not extinguish any tax liability arising in earlier years.
YARD Law advises Bulgarian and internationally mobile clients on crypto tax residence, transaction classification, investor-versus-trader status, DAC8/CARF exposure, historical transaction reviews and preparation for NRA checks or audits. For complex portfolios we coordinate the legal classification with the accounting reconstruction, rather than treating exchange exports as the tax return.
See also our guides to crypto tax in Bulgaria, the Bulgarian CASP licence and MiCA in Bulgaria after 1 July 2026, and our crypto and blockchain practice.
This article is general information as at 28 August 2026 and is not individual legal, tax or accounting advice. The Bulgarian DAC8 implementing bill has passed first reading only and must be checked again after final adoption and promulgation. Platform-specific reporting obligations and the tax classification of derivatives depend on the operative legal text and the facts of the particular case. Prepared by the legal team at YARD Law Co., a law firm based in Sofia, Bulgaria.
Crypto income to declare in Bulgaria?
Regime assessment, computing the base, trader or investor, non-residents and the Art. 37a recomputation.