In this episode, we present an audio version of Bitcoin Policy UK's formal response to HMRC’s consultation on the taxation of decentralised finance (DeFi), specifically lending and staking of cryptoassets. This submission calls for a clear, simple and principled approach that avoids harming innovation or driving talent offshore. It strongly differentiates Bitcoin from other digital assets and offers a cautious but thoughtful take on regulating and taxing DeFi activity.

🔍 What You’ll Learn:

• Why Bitcoin Policy UK believes Bitcoin should not be lumped in with "crypto"
• The potential harm of complex DeFi tax rules to UK innovation
• Why lending digital assets should not be treated as a disposal for tax purposes
• Insights on whether DeFi returns should be taxed as income or capital gains
• Examples of how poor regulation has led to consumer harm in non-Bitcoin DeFi
• A proposal to tax crypto gains only when converted to fiat—or not at all, if treated as gambling

⚖️ Key Themes:

• Clear support for self-custody and individual asset ownership
• A strong argument for keeping DeFi tax rules simple and competitive
• The need to separate Bitcoin from the broader, often speculative, crypto asset class
• Recognition of DeFi’s complexity and risks, especially in centralized platforms
• Critique of overcomplicated proposals and their chilling effect on UK competitiveness

📄 Read the full written paper here:
👉  Response to HMRC on DeFi taxation

To find out more about Bitcoin Policy UK's work and how you can get involved, visit:

https://bitcoinpolicy.uk/