C6.105 Trading or not trading in cryptoassets?
Cryptoassets (which might also be referred to as 'tokens' or 'cryptocurrency') are cryptographically secured digital representations of value or contractual rights1.
This article considers whether a person is trading in cryptoassets, which determines the UK tax treatment. For the definition of cryptoassets and cryptoasset transactions, see C6.103–C6.104. For a glossary of key terms associated with cryptoassets, see C6.102.
Indicators of trade in cryptoassets
An essential determinant to how cryptoassets are taxed is whether trade in cryptoasset exists. The usual badges of trade are considered when making this determination. However, the badges are limited when applied to trade in financial products2.
A trade in exchange tokens is, in HMRC's view, like a trade in shares, securities, and other financial products. The approach taken in determining whether an individual or corporation is trading is similar, and guidance can be drawn from the existing case law on trading in shares and securities3.
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Web page updated on 17 Mar 2025 17:05