Consistent with the ‘taxation neutrality’ principle, the taxation treatment must appropriately fit the way stablecoins are used within the FCA and BoE’s developing regulatory rules under the category of qualifying stablecoins.

Overall, there should be consistency in tax treatment across similar payment instruments to maintain a level playing field between traditional and emerging forms of payment. 

We also recognise there will be some complexities in how stablecoins should be treated when held for investment-type purposes, which we address in our response to question 11.