PolicyLens

Reform UK - Financial tax

Cut crypto CGT to 10%

Set crypto capital-gains tax at 10%, create a sandbox and explore a Bitcoin reserve.

Last updated: May 2026.

Read the policy-specific methodology note

Policy package

Reform's crypto bill proposes a 10% CGT rate on crypto assets, a two-year regulatory sandbox, banking non-discrimination, tax payment in crypto and a Bitcoin reserve fund.

  • Crypto CGT rate is set at 10%.
  • Regulatory sandbox lasts two years.
  • Bitcoin reserve creates balance-sheet risk.

Core trade-offs

Crypto investors and firms gain from lower tax and clearer rules. The Exchequer may lose revenue, and a Bitcoin reserve adds volatility risk.

  • Crypto holders and firms gain directly.
  • Treasury faces volatile receipts.
  • Public balance-sheet risk rises.

Illustrative fiscal impact

-GBP 1.0bn to +GBP 5.0bn. Central estimate: +GBP 0.5bn.

  • Positive numbers mean public-finance pressure; negative numbers mean Exchequer savings.
  • 10% crypto CGT is the main scale marker.
  • Gross costs and receipt offsets are separated in methodology.
  • Behaviour and pass-through widen the range.
  • This is not an official costing.

Economic impact by 2027-28

  • Jobs: May attract some fintech activity; scale depends on credibility and global regulation.
  • Wages: Specialist crypto and legal roles may gain; broad wage effect is negligible.
  • Prices: No broad CPI effect, but crypto asset prices remain volatile.
  • GDP / productivity: Likely small; benefits depend on real innovation, not speculation.

Assessment

A clearer crypto regime may attract some activity, but the fiscal case is weak. Lower CGT only raises revenue if compliance and onshore activity increase enough to offset the lower rate. A Bitcoin reserve is a public balance-sheet gamble, not a conventional growth policy.

Confidence: Low. The bill has policy detail, but the crypto tax base, behavioural response and reserve size are highly uncertain.

Main risks

  • Revenue volatility: Crypto gains and declarations can swing sharply with prices and compliance.
  • Balance-sheet losses: A Bitcoin reserve can lose public money if prices fall.
  • Regulatory arbitrage: A light-touch sandbox may attract activity with weak consumer protection.

Safeguards

  • Cap any public reserve and publish mark-to-market losses.
  • Keep FCA consumer-protection and AML rules.
  • Review CGT receipts after two tax years.

Academic evidence

Halaburda, Haeringer, Gans and Gandal, Journal of Economic Literature, 2022

Crypto economics review

The literature emphasises volatility, network effects, mining incentives and limited fundamental anchors in crypto markets.

Supports high uncertainty around tax-base and reserve-risk assumptions.

The Microeconomics of Cryptocurrencies (2022)

Gandal and Halaburda, Games, 2016

Digital-asset network effects

Digital-currency competition depends on network effects and expectations, not only statutory tax treatment.

Warns against assuming tax cuts alone create a crypto hub.

Network effects in digital assets (2016)

UK government evidence

Sources

Other Reform UK policies

PolicyLens estimates are illustrative and not official costings.