UK Case Law & FCA Framework
Court decisions that shape UK crypto tax law, the FCA's regulatory perimeter, and what activities require (or don't require) FCA registration.
UK Case Law & FCA Regulatory Framework
Understanding crypto tax in the UK isn't just about HMRC guidance — it also requires awareness of the court decisions that underpin the rules and the FCA framework that governs what crypto businesses can and cannot do.
Part 1: UK Case Law & Precedent
There is limited UK case law directly on crypto taxation, but several important decisions establish the legal framework:
Property Status of Crypto Assets
Fabrizio d'Aloia v Persons Unknown [2024] EWHC (Ch)
- The High Court confirmed that crypto tokens (specifically Tether/USDT) can attract property rights under English law.
- This is significant because HMRC has always treated crypto as property for tax purposes, and this decision provides judicial backing for that position.
Beneficial Ownership and Deferred Consideration
Goodbrand v Loffland Bros North Sea Inc [1998] STC 930 (Court of Appeal, 71 TC 57)
- Confirmed that deferred consideration in non-sterling assets must be valued at the time the transaction occurs.
- HMRC explicitly relies on this case in CRYPTO61620 for DeFi lending tax treatment.
Marren v Ingles [1980] STC 500 (House of Lords, 54 TC 76)
- Established that a right to receive unascertainable future consideration is itself an asset for CGT purposes.
- Applied by HMRC to DeFi scenarios where the yield/return is unknown at the time of deposit.
Recent Tribunal Decisions
HMRC v Timothy Bunting [2025] UKUT 00096 (TCC) (March 2025)
- Upper Tribunal decision on CGT loss relief under s.253 TCGA 1992 following loan capitalisation. While not crypto-specific, establishes principles on how loss relief interacts with loan arrangements — relevant to DeFi lending losses.
Situs of Crypto Assets
HMRC pragmatically treats the location of crypto assets as the tax residence of the beneficial owner, not the location of the exchange or wallet. This avoids complex questions about where a blockchain "exists."
Part 2: FCA Regulatory Framework
What the FCA Regulates in Crypto
Since January 2020, the FCA is the anti-money laundering supervisor for UK crypto asset businesses under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017).
FCA-registered crypto asset businesses must:
- Be registered on the FCA's crypto asset register
- Conduct customer due diligence (KYC)
- Have a Money Laundering Reporting Officer (MLRO)
- Report suspicious transactions to the NCA
- Comply with the Travel Rule (from 1 September 2023)
Activities That Require FCA Registration
- Operating a crypto asset exchange (fiat-to-crypto or crypto-to-crypto)
- Operating a crypto ATM
- Issuing new crypto assets (ICOs)
- Publishing crypto asset advertisements (from 8 October 2023)
Activities That Do NOT Require FCA Registration
- Providing information about crypto assets (education, tracking, analytics)
- Providing software tools for portfolio management
- Displaying crypto asset prices from public data
- Calculating tax obligations related to crypto
This distinction is important — it means platforms like CoreFi that provide education and tracking (not trading or advice) do not need FCA registration.
HMRC CRYPTO10250 — Location of crypto assets for tax purposes.
MLR 2017 — Money Laundering Regulations.
FCA — Register of cryptoasset firms.
Explain Like I'm 5
Judges in the UK have decided that digital coins count as something you own, like a toy or a book. There are special grown-up rules about where your coins 'live' for tax. There is also a group called the FCA who make sure coin shops follow the rules. If you just teach people about coins or help them count their coins, that is fine. But if you run a coin shop or tell people which coins to buy, you need special permission.
Key Takeaways
- UK courts have confirmed crypto attracts property rights (d'Aloia v Persons Unknown [2024]).
- Key cases (Marren v Ingles, Goodbrand v Loffland) underpin HMRC's DeFi tax treatment.
- HMRC treats crypto as located where the beneficial owner is tax-resident.
- FCA registration is required for exchanges, ATMs, ICOs, and crypto advertising — but NOT for education or tracking tools.
- Since October 2023, crypto financial promotions are regulated by the FCA.
Educational only - not financial advice