Agreements for sale and re-purchase of securities
A REPOS is a secured loan related to traditional shares or securities. An owner of shares or securities may sell them to a lender on the understanding that he will repurchase them at an agreed price at some future point. There are now providers offering REPOS with cryptoassets.
HMRC state:'It will be a question of fact whether the tokens being loaned and borrowed or staked (as applicable) can satisfy the definition of a security for the purposes of sections 263A or 263B TCGA 1992. Generally tokens will not be securities for this purpose.'
The REPOS legislation (applying to shares and securities, not cryptoassets) serves to ignore the sale and re-purchase of the shares for capital gains tax purposes.
As HMRC do not expect cryptoassets to qualify as a security and benefit from this generous CGT exemption; they are expecting REPOS involving cryptoassets to realise a capital gain upon disposing of the cryptoassets and there will be a CGT re-acquisition when they are bought back (on the basis it is expected that beneficial ownership of the tokens will transfer to another party).