UK's New Tax Policy for Crypto Lending Gets Thumbs Up from Aave Founder

Aave's founder Stani Kulechov has praised the UK's new tax policy for crypto lending and liquidity pools, calling it 'the right direction' for the sector.

The policy, introduced by HMRC on July 13, adopts a 'No Gain, No Loss' (NGNL) rule that treats deposits into protocols like Aave as tax-neutral. This means users won't owe capital gains tax until they sell or withdraw their assets, rather than at the time of deposit.

Kulechov stated in a post on X that the industry feedback played a crucial role in shaping this policy, which is set to take effect from April 6, 2027. He noted that the NGNL treatment will remove 'dry' tax charges and make DeFi more accessible to everyday users.

The new policy is expected to boost DeFi adoption in the UK by reducing legal ambiguity around crypto regulations for users and institutions. Aave's founder emphasized that this development demonstrates the industry's influence on regulatory decisions, as seen with the £20,000 stablecoin holding cap.