HMRC is proposing new rules for the taxation of cryptoasset lending, borrowing and liquidity pools, including a move to “no gain, no loss” treatment for qualifying arrangements. This would mean that lending Bitcoin and later receiving Bitcoin of the same type back should not itself trigger a capital gains tax charge. Bitcoin Policy UK supports this core approach, which reflects its longstanding position that lending Bitcoin should not be treated in the same way as disposing of it. This is an audio version of Bitcoin Policy UK’s response to HMRC’s draft legislation in full.The response examines where the proposed rules work well for Bitcoin, as well as areas where BPUK believes the drafting needs further clarification. These include the “low risk of loss” test for Bitcoin lending, the potentially problematic tax treatment of forfeited collateral, and the complexity of the provisions dealing with defaults and repayments. BPUK also calls for plain-English guidance with Bitcoin-specific examples before the new regime takes effect on 6 April 2027. The paper also considers an important distinction between native Bitcoin and wrapped or tokenised Bitcoin. While the two may receive similar tax treatment in some circumstances, BPUK argues that guidance should make clear that they have materially different characteristics and risks. Finally, the response highlights an issue these reforms do not resolve: capital gains tax on everyday Bitcoin payments. BPUK continues to argue separately for a full CGT exemption for retail Bitcoin payments.📄 Read the full written paper here:👉  Response to HMRC's Draft Legislation on Cryptoasset Loans and Liquidity PoolsTo find out more about Bitcoin Policy UK's work and how you can get involved, visit:https://bitcoinpolicy.uk/