British tax officials say putting cryptocurrency onto lending platforms won't trigger immediate tax bills

British tax officials have issued new rules that could make it easier for people to use cryptocurrency lending platforms without facing immediate tax bills, according to Aave founder Stani Kulechov.

The tax authority HMRC has said that putting digital coins or stablecoins like USDC and USDT onto decentralised finance platforms won’t count as a taxable event at the moment of deposit. This means people who lend out their cryptocurrency, stake it, or borrow money against it won’t face capital gains charges just for placing their digital holdings onto these platforms.

Stani Kulechov, who started the DeFi platform Aave, said the decision follows years of back-and-forth discussions with tax officials and brings much-needed answers to users.

Tax bills will now only kick in when someone actually gets rid of their assets by selling them, swapping them for something else, or cashing out. Moving tokens in and out of DeFi protocols is being treated as having “no gain, no loss,” giving people clearer rules about what they’ll owe.

What this means for crypto users

“For users, this is significant,” Kulechov told Yahoo Finance Future Focus. “They now have more clarity over HMRC’s approach, and they can use DeFi lending protocols to borrow funds against their collateral without creating a taxable event or a disposal.”

The tax authority made it clear that locking up cryptocurrency as collateral for a loan, or putting a single token into a lending or staking arrangement, wouldn’t trigger a tax charge when deposited under this “no gain, no loss” approach. The taxable moment generally gets pushed back until there’s an actual disposal, such as selling or exchanging the asset.

Kulechov said this clarity might also push more professional investors to try crypto innovations. These bigger players have often stayed away from DeFi because they weren’t sure about the rules and taxes.

“It simplifies the tax approach, which reduces the burden and allows for wider adoption by institutions, but also simplifies things for regular retail users,” he said.

Kulechov pointed out that getting more people to use decentralised finance depends heavily on making it simpler. Up until now, DeFi has mostly attracted people who know their way around blockchain wallets and exchanges.

Aave is trying to change that by building a consumer-friendly experience that works on mobile phones, letting users shift money from regular bank accounts into Aave without much hassle. The platform handles the complicated technical stuff behind the scenes.

“Providing a seamless mobile experience is a really big opportunity for retail users,” he said. “It makes yield generation and lending accessible to a much wider audience.”

Changes to traditional savings

The new guidance arrives as traditional savings options in Britain are becoming less appealing. The government’s autumn budget decided to cut cash ISA allowances, which could push many savers to look for better returns elsewhere. Starting April 2027, the yearly cash ISA limit for people under 65 will drop from £20,000 to £12,000, giving people less room for tax-free cash savings.

DeFi platforms like Aave, on the other hand, let users earn steady returns on their digital assets that don’t move with traditional markets, while still being able to put money in or take it out whenever they want. Kulechov said this mix is becoming more attractive to savers hunting for new financial options.

“What DeFi really helps with is accessing yield and financial opportunities,” Kulechov said. “Aave has been battle-tested over the past five years and shows how decentralized finance as financial infrastructure can work effectively, mitigating single points of failure through smart contracts.”

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