On the morning after the last day of 2026 — assuming the German Federal Ministry of Finance gets the calendar it wants — a retail holder in Leipzig will open an assessment notice and learn something no exchange screen ever told her. The twelve thousand euros she spent on bitcoin across three venues and one hardware wallet, whose seed phrase lives on a steel plate in a kitchen drawer, will have been re-described by the state. Not revalued. Re-described. The coins she sold in the third quarter of 2026 for nine thousand euros — a loss of three thousand before fees — will carry an official acquisition cost of four thousand five hundred euros, because the Ministry proposes that where a taxpayer cannot document what she paid, the state will simply determine that she paid half of what she received.
A gain of four thousand five hundred euros. On an asset that fell.
The assessment will not use the flat twenty-six point three seven five percent of the Abgeltungsteuer, because §23 EStG gains are not capital income in the German architecture — they are sonstige Einkünfte, other income, taxed at the personal marginal rate, a distinction that has quietly cost German crypto holders more than any exchange fee they have ever paid. At forty-four point three one percent, the top rate plus solidarity surcharge, the bill lands near nineteen hundred and ninety-four euros. The loss is real. The tax is real. The gain is a fiction, and the fiction is the entire design.
I have spent nineteen years inside this industry watching the market's chaotic surface, and I have learned to distrust any policy that requires the world to behave a certain way in order to remain coherent. This proposal requires the world to have doubled. It has not doubled. That gap is where everything worth saying about this bill lives.
I. The Exemption That Was Never a Policy
To understand what the Federal Ministry of Finance is trying to dismantle, you have to understand that it never built the thing in the first place. Germany's reputation as a crypto-friendly jurisdiction rests almost entirely on a single sentence inside §23 of the Einkommensteuergesetz: private sales transactions of "other economic assets" held for more than one year are exempt from income tax. The Spekulationsfrist. Twelve months, and the gain evaporates from the tax base.
This is not the product of a legislative vision about digital assets. When the rule was written, the phrase "other economic assets" was plumbing language, a catch-all designed to capture the odd private disposal that did not fit the categories of securities, real estate, or capital claims. Crypto arrived in the 2010s and simply fell through a hole in a taxonomy. The Bundesfinanzministerium's letter of 10 May 2022 on the income-tax treatment of virtual currencies confirmed the technical mechanics — mining, staking, lending, exchanging — and in doing so quietly ratified the one-year exemption as if it had been intended all along. It had not been. Germany became the most attractive retail crypto jurisdiction in the European Union by accident, and accidents are the easiest things in the world for a ministry to reverse.
I want to be precise about why this matters, because the framing determines how you read the proposal. If the one-year rule is a deliberate incentive, then removing it is a hostile act against a defined policy stance. If the one-year rule is an omission, then the Ministry is not attacking crypto at all — it is closing an unintended aperture. When I audited the Ethereum whitepaper in 2017, I learned the same lesson about smart contracts that I now apply to tax statutes: the flaws that hurt you are almost never the ones the designers debated. They are the ones nobody noticed were load-bearing.
II. What the Ministry Actually Wrote
The proposal circulating out of Berlin, reported through crypto-native channels and traced back to the Federal Ministry of Finance, contains two mechanisms that must be separated, because they produce different injuries.
The first is a date. Acquisitions are deemed to occur after 31 December 2026. The second is a substitute tax base — an Ersatzbemessungsgrundlage — set at fifty percent of the disposal proceeds. Layer them and the effect is this: any holder who cannot furnish a credible acquisition cost to the Finanzamt loses the benefit of the holding period, loses the benefit of their actual entry price, and is taxed on a constructed basis that assumes the position roughly doubled.
The burden of proof sits with the taxpayer. Not shared. Not assisted. Transferred. Patrick Hansen, Circle's Senior Director for EU Strategy and Policy, has been the loudest institutional voice against the math, arguing that with bitcoin trading below its level of a year earlier and most recent buyers in marginal profit or outright loss, a fifty-percent deemed basis is a tax on value that does not exist. Dr. David Hötzel of the law firm Poellath has supplied the second, more operationally chilling observation: the proposal creates a material liquidity risk, because the assets most likely to fail the proof test are precisely those held on self-custody or on non-German platforms, and the cheapest way to satisfy a tax bill you cannot otherwise fund is to sell the asset that generated it.
Two independent voices. One from a stablecoin issuer with a commercial stake in friendly European regulation, one from a law firm with clients who will be audited. They agree on the mechanism. When a party with an obvious bias and a party with a professional duty of care converge on the same structural criticism, the criticism usually survives the bias.
III. The Arithmetic of Fifty Percent
Here is where most coverage stops, and where I want to start. The interesting question is not whether fifty percent is too high or too low. The interesting question is what fifty percent means, because a substitute basis is a compressed value judgment, and it can be decompressed.
If the deemed acquisition cost equals half of the disposal proceeds, then the state is asserting, for every affected taxpayer, that the asset was acquired at half the price at which it was sold. That is an implied multiple of two. Not an estimate. Not a range. A single point estimate encoded so tightly into the formula that the legislator may not have noticed it was making a market forecast.
Run the numbers across the actual distribution of outcomes and the mechanism sorts itself into three populations, with very different experiences of the same rule. A holder who bought at one quarter of the eventual sale price — the genuine four-year veteran, seeded in 2022 and exiting in 2026 — has a true gain of seventy-five percent of proceeds. Under the substitute basis, the state deems a gain of fifty percent. That holder is under-taxed, and will never complain, and will never be asked whether the rule is fair. A holder who bought at exactly half is perfectly modelled, taxed on a gain that matches reality to the euro, and constitutes the legislator's imagined taxpayer. A holder who bought at or near the sale price — the 2024 and 2025 cohort, the cohort that exists in the largest numbers — has a true gain of zero or less, and is taxed on fifty percent of proceeds.
The third population is not an edge case. It is the modal case. And the mechanism does not merely misjudge it; it inverts it, converting a capital loss into a taxable event with a positive liability. That is not aggressive taxation. It is taxation of a sign error.
There is a second-order effect that deserves its own paragraph because I have not seen it raised. Loss offsetting under §23 EStG is narrow — losses from private sales transactions can generally only be netted against gains of the same category. Under the current regime, a 2025 buyer who sold at a loss has nothing to offset and no liability. Under the proposal, that same holder has a deemed gain, and a deemed gain is a much more portable thing. It can be netted against other deemed gains, and only those. The state has not just created revenue from nothing; it has created a parallel tax universe with its own fungible loss currency, and the exchange rate between that universe and the real one is set by a formula nobody in the market can influence.
I stress-tested liquidity flows inside Aave v2 during DeFi Summer, modelling the interaction between collateral ratios and redemption behaviour, and the single most valuable lesson from that work was this: a system's fragility is almost never located where its designers placed the safety parameters. It is located where an assumption has been embedded so deep that nobody thinks to test it. In Aave it was stablecoin pair correlation. Here, it is the assumption that a rational legislator would not need to check whether the market had doubled. Someone should check. The answer is no.
IV. Why Your Basis Is Unprovable
There is a version of this debate in which the taxpayer is a careless person who simply failed to keep records, and the Ministry is a patient administrator offering a rough-and-ready default. That version is comfortable and false.
I have built and torn apart enough wallets to say this without hedging: for a meaningful share of German retail holders, a defensible cost basis is not merely undocumented, it is technically unreconstructible. Consider the anatomy. A position assembled across a German bank account, a non-EU exchange that has since exited the market, a DEX swap executed through a router contract with no email address and no customer record, and a bridge transfer that consumed a fee denominated in the destination asset. Reconstructing the euro cost of the surviving token requires a full historical price series for three assets, a record of fee conversion, and a chain of custody nobody is obligated to provide.
Add the harder cases. Tokens received as an airdrop have a cost basis conventionally set at the fair market value on receipt — a value that must be established on a specific date, at a specific block, and defended.
Liquidity provision is worse. When I modelled liquidity behaviour in 2020, the hardest part of the exercise was not the risk math; it was reconciling impermanent loss against fee income across a position that had been opened and closed three times in a single fortnight. A German retail LP in 2025 faces that reconciliation as a tax obligation, with a burden of proof attached.
Staking compounds the problem precisely at the point where it should be simplest. Each reward is arguably a separate acquisition at a separate price on a separate date, and the German framework has treated staking rewards as taxable income at receipt while their later disposal falls under §23 — meaning the same tokens may generate two taxable events with two different bases, one of which the holder must compute from a validator's payout schedule in a currency they never held.
Now layer the mechanism on top. The proposal does not say "provide a reasonable estimate." It says: prove it, or accept fifty percent of proceeds as your basis. The holder who has perfect records and the holder who has none are separated by a single procedural test, and the gap between their tax liabilities can exceed a factor of three on identical economic outcomes. That is not a tax system. That is a lottery with an audit trail.
V. Presumptive Taxation: A Short Institutional History
The substitute basis is not a novelty. It has a genealogy, and the genealogy is instructive.
Presumptive taxation — determining the tax base by inference rather than measurement — is one of the oldest instruments in fiscal administration. Agriculture was its first great subject. When a farmer's harvest could not be inventoried and a cash economy did not exist to price it, the state taxed the land's assumed yield rather than its actual one. Rental income followed the same path: imputed rent, a value the owner never received, taxed because the value was real even where the cash flow was not. In each case, the state's justification was not fairness but administrability, and in each case the state was candid about the trade: we will accept imprecision in exchange for collectability.
Two conditions made those historical applications tolerable. First, the imputed base was recalibrated periodically against observable reality — cadastral surveys, rent rolls, harvest statistics. Second, the imputed base was, on average, roughly accurate, so that errors washed out across the population rather than concentrating on one class of taxpayer.
The proposal holds neither condition. Its fifty-percent basis is calibrated to a market condition — a doubling — that the article's own market data refutes, with bitcoin trading below its level of a year prior and the broader altcoin complex performing worse still. And its errors do not wash out: they concentrate, with mechanical precision, on the cohort that entered latest and holds least. Presumptive taxation applied to a fixed asset with a slow-moving base is a compromise. Presumptive taxation applied to an asset class with a 70 percent annual range is a coin flip dressed as a statute.
What is genuinely new here is the trigger. Historical presumptive regimes were triggered by structural unmeasurability — there was no way to count the grain, so the grain was estimated. This regime is triggered by a documentation failure in a world where measurement is entirely possible, just not centralized. The state is not presuming because it cannot know. It is presuming because it cannot see, and there is a difference between those two sentences that the entire bill turns on.
VI. Ability to Pay and the Shadow of Karlsruhe
German tax law does not float free of constitutional constraint, and the relevant constraint here is the principle of taxation according to capacity — the Leistungsfähigkeitsprinzip. A tax must attach to an economic capacity that actually exists. You may not tax a capacity that does not.
The proposal's exposure on this point is not subtle. Where a holder has realised a loss, the deemed gain corresponds to no increase in the taxpayer's economic position. Where a holder has realised a modest gain, the deemed gain exceeds it. In both cases the state collects against an imputed capacity, and in the first case it collects against a negative capacity, which is the constitutional equivalent of a category error.
I want to be careful here, because it is easy to overreach. The Bundesverfassungsgericht's 1995 decision on the wealth tax articulated a "half-income principle" — a rough ceiling on the cumulative burden of income and asset taxation — and that principle has been substantially softened by later jurisprudence, which treats it as a guideline rather than a rigid cap. The stronger constitutional arguments are narrower and more durable: Article 3(1) of the Grundgesetz, the equality clause, and its fiscal corollary that the state must treat economically identical situations identically. Two taxpayers with the same realised gain from identical assets, distinguished only by whether one kept a PDF from a defunct exchange, are not identically situated in any morally relevant sense. The proposal makes that distinction the axis of liability.
The retroactivity argument, widely floated in the coverage, is weaker than it looks. A rule with a 31 December 2026 cut-off that attaches to disposals occurring after it is prospective in form; the fact that its burden depends on facts from 2024 does not make it retroactive in the technical sense, it makes it referential. That is a distinction lawyers will enjoy and holders will not.
What troubles me more than the doctrine is the discretion. If "credible proof" is never defined — and the reporting on this proposal leaves it conspicuously undefined — then the tax office holds an unreviewable lever, and the taxpayer's effective rate becomes a function of an individual official's judgment about a spreadsheet. I have spent enough time inside codebases to know the failure mode: it is not the malicious actor, it is the underspecified function. Ambiguity at the specification layer compounds into chaos at the execution layer, and German crypto holders are about to be executed against an unspecified function.
VII. The Information Inversion
Here is the part of this story I have not seen anyone say, and it is the reason I sat down to write rather than simply note the news.
Europe has already decided how it will learn about crypto gains. DAC8, the directive amending the EU's administrative cooperation framework, applies from 1 January 2026 and obliges crypto-asset service providers to report their clients' holdings and transactions to tax authorities, with the first reporting covering the 2026 calendar year and flowing in 2027. Sitting alongside it, the OECD's Crypto-Asset Reporting Framework sets the global template. The direction of travel is unambiguous: the reporting obligation migrates from the individual to the intermediary. The exchange tells the state. The holder does not have to prove anything, because the state already has the data.
Against that backdrop, the Ministry's 31 December 2026 cut-off does not look arbitrary. It looks like a data horizon line.
Think about what the Ministry can see. From 2026 onward, under DAC8, it can see what a German-regulated platform or a reporting foreign intermediary knows. Before 2026, across the migration years, reallocation years, and self-custody years, it sees whatever the taxpayer chooses to hand it. The proposal does not say "we cannot verify pre-2026 acquisitions." It says nothing at all about why the line falls there. But the line falls exactly where the state's own visibility begins, and the substitute basis is the price it charges for the years it was blind.
This reframes the entire instrument. The fifty-percent basis is not primarily a revenue measure. It is a penalty for living in the information gap, and it is designed so that the penalty is payable in the one currency the state can observe: realised proceeds on a reporting platform. The mechanism does not merely tax the past; it compels the past into the present, where it can be seen.
That is why the liquidity risk identified by Poellath is not a side effect. It is the vector. Assets sitting on self-custody or on non-reporting foreign venues are invisible; assets sold on a German platform generate a proceeds figure the Finanzamt can match its own records. A holder facing a deemed gain on an unsellable position has a rational incentive to move that position into the observed perimeter, realise it, and pay. The rule does not need to be enforced. It self-enforces through the taxpayer's own panic, and the state's chaotic surface never has to resolve into an audit.
VIII. The December Cliff
Any rule anchored to a specific calendar date creates a specific behaviour in the weeks before that date. This one is anchored to a date that is, by design, the boundary of what a regulator can reasonably call "current."
The cliff mechanics work like this. Before 31 December 2026, a holder can act inside the old regime's logic: ensure holdings sit where they can be documented, consider whether the one-year exemption can be crystallised before the door closes, and decide what to move and what to abandon. After it, the substitute basis looms over anything undocumented. The behavioural response to a cliff is not spread smoothly across the year; it is concentrated in the fortnight before the edge. Anyone who has watched a protocol's governance vote approach a quorum deadline, or a token unlock approach its cliff, knows the shape of the curve. It is flat, then vertical.
The German manifestation will be milder in price impact and sharper in composition. Germany is a G7 economy but a small share of global crypto flow; the probability that German retail positioning moves the bitcoin price is low. What it will move is the geographical distribution of German-held assets and the composition of German platform order books in the final quarter of 2026. That is a local liquidity event with global irrelevance, and it will be reported as a global story, which is the permanent tax on anyone who reads crypto media.
The more durable consequence is not the sale but the decision that precedes it. A holder who concludes that documentation is impossible does not merely sell. She reconfigures. She moves custody to a jurisdiction where the question is not asked, or she moves herself. Neither action appears in any tax statistic, and both are the real output of the policy.
IX. The Jurisdictional Referee
Tax policy in an open capital market is not a unilateral act. It is a bid.
Switzerland taxes private capital gains on movable assets not at all, as a general matter of the distinction between private wealth management and professional trading. The United Arab Emirates imposes no personal income tax, and has spent a decade building the institutional scaffolding — free zones, licensing regimes, banking rails — that makes a relocation legible rather than exotic. Portugal has narrowed and re-narrowed its crypto treatment over successive budgets but retains structural advantages for long-duration holding. Luxembourg and Ireland compete on a different axis entirely, for funds and structures rather than individuals.
Germany's current position is genuinely unusual in this field: a one-year holding exemption is not a modest advantage, it is a categorical one, converting the tax question from "how much" into "how long." Remove it and substitute a deemed-doubling basis, and Germany stops being the outlier on the friendly end of the distribution and becomes an outlier on the other end. The proposal does not move Germany to the middle of the European field. It moves Germany past the middle, into territory where no peer jurisdiction imposes a presumptive gain on an unproven basis.
That is the part of the analysis I find most revealing. A revenue ministry contemplating a deficit does not ordinarily design a rule whose primary foreseeable consequence is the relocation of the tax base it hopes to tax. When a rule's arithmetic points one way and its incentive structure points the other, you are looking at a policy that was written by people optimising for administrative closure rather than for revenue. The ministry wants this question resolved. It has been open since 2013, it has generated a decade of ambiguity, and a rule that resolves it — even at the cost of the tax base — may look, from inside a ministry, like a bargain.
X. The Friendly Germany Story Was an Omission
I want to state the contrarian position cleanly, because it runs against the grain of how this story is being told across the industry.
The consensus reading is that Germany is turning hostile. A once-friendly jurisdiction, host to a large developer community and a reputable exchange sector, is abandoning its exemption and moving toward penal taxation. The framing implies a trajectory, a policy direction, a government that has decided something about crypto.
I do not believe that. I believe Germany never decided anything about crypto, and this proposal is the sound of a bureaucracy finally deciding.
Consider the evidence. The one-year exemption is a byproduct of a taxonomy gap, ratified post hoc by an administrative letter rather than created by a statute. The Krypto-Marktgesetz, which reshaped German custody and exchange supervision in alignment with MiCA from the end of 2024, is a compliance statute, not a promotional one — it licenses the industry rather than championing it. Germany has never had a digital asset strategy in the sense that Switzerland, Singapore, or the UAE have had one. It has had a legal system that occasionally produced favourable outcomes because German law is systematic and crypto was not yet a system it had addressed.
The distinction matters because it predicts the future. If Germany were hostile, the proposal would be accompanied by a communicative campaign framing crypto holders as a problem to be solved, and the industry would be negotiating from a position of acknowledged adversary. Instead we have a technical consultation with a cut-off date that aligns to a reporting directive's implementation window, opposed by a stablecoin issuer and a law firm rather than a mass movement, with no coordinated retail voice anywhere in the record. That is not hostility. That is indifference discovering a spreadsheet.
Indifference is worse news than hostility, for one reason. Hostility can be defeated at the ballot box. Indifference only responds to administration, and administration takes a decade.
XI. Who Actually Pays
The distributional story inside Germany is not the one the headlines imply, and getting it right tells you who will fight and who will not.
The cohort with the strongest incentive to litigate is not the one with the largest holdings. It is the 2024–2025 entrant: bought near the local top, sitting on a nominal loss, holding a position too small to justify a tax lawyer and too large to ignore an assessment. That group has the grievance, the arithmetic on its side, and no institutional representation. It is the same structural position as the retail borrower in 2022 who discovered that the risk disclosures were accurate — the population that absorbs the loss is never the population that designed the instrument.
The long-duration holder — the 2019 or 2021 buyer sitting on a genuine multiple — is quietly advantaged by a fifty-percent deemed basis and will not litigate anything. If she can prove her basis, she takes the real number; if she cannot, she takes a discount to her real gain. The proposal has an internal coalition, and the coalition is the patient.
The German exchange sector sits in the most uncomfortable seat. On a short horizon, a reallocation of assets onto German platforms to establish provable proceeds looks like inflow, and someone in a compliance department will describe it that way in an investor deck. On a medium horizon, the same platforms face users who now associate German venue with taxable visibility, and the association is sticky. A compliance moat built out of a tax penalty is not a moat; it is a fence around a shrinking field. This is the same structural trap I documented when I audited the NFT market in 2021 — a venue that captures demand by being the most legible place to transact eventually discovers that legibility was the cost of admission, not the product.
And there is a beneficiary nobody is naming. Every increase in the complexity and consequence of cost-basis reconstruction increases the value of portfolio-tracking and tax-reporting tooling, of advisory services, and — most interestingly — of self-custody architectures that never generate a custodial record in the first place. A tax regime designed to compel visibility can, if poorly calibrated, increase the demand for architectures whose defining feature is that they produce none. I flag this with low confidence and high interest: the strongest predictor of DeFi adoption in the last five years has never been yield. It has been the perception that someone is watching.
XII. What the Industry's Objection Is Actually Worth
I have to be honest about the messengers, because I have spent my career being honest about messengers and it has cost me more relationships than any bad trade.
Circle's intervention on German tax policy is professionally sound and commercially motivated. A stablecoin issuer with ambitions in the euro-denominated market has a direct stake in the EU's regulatory temperature, and tax administrability is part of that temperature. Hansen's argument is nonetheless rooted in a factual claim — that the market has not doubled — which is verifiable and, currently, verified. The motive does not contaminate the math. It does, however, mean that the argument will be pursued only as far as it serves the issuer's interests, and will be dropped the moment it does not.
Poellath's contribution is different in kind. A law firm publishing a liquidity-risk assessment is describing the operational reality its clients will face, and law firms are structurally reluctant to overstate because their credibility is the asset. When a lawyer says the assets most likely to fail the proof test are the ones on self-custody and foreign platforms, that is a client-facing prediction, not a talking point.
What is missing from the record is the affected party. German retail holders have no trade association with standing in this consultation, no coordinated comment process, no lobbyist walking the corridors of the Ministry. The industry's position on a German retail tax question is being argued by an American stablecoin company and a Munich law firm. That absence is itself the most important data point in the entire story, and it is the same absence I found when I withdrew exposure from Aave weeks before the anchor instability in 2020 — the people holding the risk were not the people in the room.
XIII. Positioning Inside a Sideways Chop
The market context matters here, and I want to be specific rather than atmospheric, because specificity is the only thing that separates analysis from mood.
We are in consolidation. Bitcoin sits below its level of a year prior; the broad altcoin complex sits lower still. This is not a bull market pausing; it is a market that has not yet decided, and the tell is not price but participation — no froth, no funding extremes worth charting, no retail mania to exploit. In a chop, positioning is the only productive activity, and positioning means deciding in advance what you will do at levels and dates that have not arrived.
A rule anchored to 31 December 2026 is, functionally, a scheduled volatility event for German holders. It has a date. It has a known trigger. It has a definable population. That makes it tractable in a way that most macro events are not.
The specific asymmetry I would flag, to the extent any of this is actionable, is not about price at all. It is about evidence. The single highest-return action available to any German holder reading this is not a trade. It is the reconstruction of a cost basis: exchange statements, on-chain transfer records, bank wires, stablecoin conversion receipts, anything that converts an unprovable position into a provable one. In a regime whose entire architecture rests on a documentation test, documentation is the asset, and holders who spend the next few quarters building it are buying optionality at zero cost. I have made exactly two decisions in nineteen years on this kind of intuition rather than on a model — withdrawing from Aave exposure before the anchor broke, and walking away from the NFT market four months into an audit I had expected to complete. Both felt excessive at the time. Both were correct, and neither was derived from a spreadsheet.
XIV. The Signals That Will Decide This
The proposal is not final. That sentence is doing more work in this article than any other, and it deserves its own accounting, because a moving target is a different kind of object than a fixed one.
Four things determine the outcome, and each is observable without privileged access. The first is whether the fifty-percent substitute basis survives the legislative process at all; it is the single provision most likely to be softened, because it is the one with an arithmetic defect that a parliamentary committee can discover in an afternoon. The second is whether "credible proof" is ever defined in the statutory text; an undefined evidentiary standard is a drafting failure, and drafting failures are what committee review exists to fix. The third is whether German industry associations formally enter the consultation, which would convert this from a two-voice objection into an institutional one and materially change the political cost of the provision. The fourth is the price of bitcoin relative to a year prior — because the mechanism's entire legitimacy rests on an embedded forecast, and the forecast is falsifiable in real time.
Watch the fourth one most carefully, for a reason that has nothing to do with portfolio value. If bitcoin rises sharply and the 2024–2025 cohort moves into genuine profit, the fifty-percent basis becomes approximately fair for the modal holder, the political energy behind the objection collapses, the provision passes, and the industry learns a durable lesson about the difference between a bad rule and an unpopular one. A bad rule that produces correct answers in a bull market is the most dangerous kind of rule, because it will be defended by its own outcomes.
That possibility is what keeps me from calling this an unambiguous defeat. It is a rule built on a market assumption, and market assumptions are not policy. They are bets. This one is placed on a doubling, made by an institution that does not trade, endorsed by no one who holds, and secured against the only cohort that cannot afford to fight it. When the ledger is finally written, the ministry will have taxed a number it invented, in a currency it can see, from people it never asked — and it will call that compliance. What name would you give it, if you were the one holding the seed phrase in the kitchen drawer?
