Some of the most common types of cryptoassets are often referred to as “cryptocurrencies” because, in a nutshell, they can be used to buy things. However, in many settings, they do not meet the definition of money, especially for tax or financial reporting purposes.
In fact, in the UK, at present, they are never considered money, and their use almost always means a tax reporting event has occurred.
One ramification of this is that if a UK taxpayer spends their USDC or their Bitcoin to purchase something, they must consider current UK tax requirements for disposals of property; in other words, those cryptoasset transactions are generally and decidedly, not the same as using money.
Many cryptoassets appear to be similar to or a digital representation of what many of us think of as money because they can be denominated in and backed or linked to currencies, such as the US dollar (USD)….
