ChancellorFaces Taxing Test in Bid to Boost Capital MarketsTheUK Treasury’s latest plan for stimulating its stock exchanges appears to be atemporary or permanent reduction in the stamp duty (tax) paid on transactionsin shares of newly listed companies.Advocatesof stamp duty reform have long argued that the UK is at a competitive disadvantageto other major European markets as a result of the 0.5% tax levied on sharetransactions, pointing out that the US and Germany don’t levy any tax on suchtransactions.JoinIG, CMC, and Robinhood in London’s leading trading industry event!Theyclaim that removing the stamp duty would stimulate trading in stocks ofUK-listed companies and encourage more people to trade at a time when a lot ofcapital is lying idle in savings accounts.Previousresearch has suggested that even a minor reduction in transaction costs can booststock prices considerably and that removing the duty could reduce the post-taxcost of equity of UK listed companies by as much as 8.5%.OneUK investment bank refers to a ‘pernicious’ tax that negatively impactsliquidity in UK equity markets and by extension the entire financial sector,which whether everyone likes it or not is a major contributor to the UKeconomy.Abolish stamp on equity trading. Cut corp tax for first few years after listing. Cut CGT on sale of founder stakes at IPO. Mandate Brit ISA plus 20% of pension equity allocation to UK. And do it VERY FAST. Politicians do not seem to grasp that time is running out. https://t.co/YBxAu6nGiu— Merryn Somerset Webb (@MerrynSW) October 1, 2025Theproblem the UK government faces is that stamp duty on shares raises severalbillion pounds every year. The Chancellor has been talking about making toughdecisions on general taxation to improve public finances ahead of next week’sbudget, so any move to remove tax on investing is likely to provoke a majorbacklash.Thereis also the point that the FTSE 100 is trading at near-record levels under thecurrent tax regime.Eitherway, investors would be well advised not to count their savings just yet.Earlier this year, the possibility of raising the level of tax on dividends and/orremoving the allowance that sees taxpayers only pay tax on dividend incomeabove £500 was floated – and with talk of a public finance gap in the tens ofbillions, nothing is off the table.CryptoRules – Okay?TheEuropean Fund and Asset Management Association (EFAMA) has set out its case forreform of the digital assets framework to fast-track improvements in EU capitalmarkets.Theassociation reckons Distributed ledger technologies (DLT) can provide a solution to challenges such as fragmentedpost-trade infrastructures, lack of competition and cross-border flows amongfinancial market infrastructures and national differences in securities,taxation and insolvency laws.Asense of frustration is understandable. The EU’s DLT pilot regime is coming on for three and a half years old but over that timejust three infrastructures have been granted permission to operate DLT tradingand settlement systems, and only a handful of live transactions have beenfacilitated.Last week's roundtable was a great opportunity for us to discuss the current state of the digital asset landscape and it's competitiveness here in Europe.MiCA gave European banks and financial institutions the confidence to lean into the industry. As a result, we now see lots… pic.twitter.com/9M89WxDNGX— Cassie Craddock (@CraddockCJ) October 10, 2025Theobvious response from sceptics would be to suggest that this is indicative of alack of interest from potential digital asset service providers. But this wouldbe to ignore the reality that the regime has met with considerable resistancefrom those with a vested interest in maintaining existing capital marketstructures.Thisis not to say that the scheme is perfect. The European Commission has noteffectively communicated its scale, leading some potential market participantsto assume that it was a fixed term project that would be superseded over arelatively short timeframe or that the volume cap might not be removed.ESMAhas pointed to the failure to support e-money tokens issued by e-moneyinstitutions as a further barrier. Any update to the regime should also enablesettlement in euro-denominated stablecoins licensed under the Markets inCrypto-Assets Regulation, which would facilitate straightforward access to cashon-chain and significantly boost the European stablecoin market in its fightfor relevance against cryptocurrencies pegged to the US dollar.TanguyVan de Werve, EFAMA director general observes that many European firms havemade significant investments in DLT and that these efforts should be matchedwith a clear commitment from EU authorities to deliver on a DLT-basedecosystem. Piecemealchanges - weighed down by lengthy legislative processes - will not give themarket the necessary signals for further investments.DATsNot What Retail Investors ExpectedIna recent LinkedIn post, Anton Golub, chief business officer at Freedx outlinedhow retail investors have lost around $17 billion by buying shares of digital assettreasuries or DATs - firms that explicitly pursue a strategy of accumulatingdigital assets as a core function of their business (think Strategy orMetaplanet).We’ve all got mixed feelings about DATs.They’ve become a real force in this cycle and, on the surface, that’s a clear signal: new money flowing straight into spot instead of derivatives or funds. It’s tangible demand, and the market feels it.But they’re also messy. DATs are… pic.twitter.com/wGDp4yPkN2— Justin d'Anethan (@justindanethan) October 22, 2025Theproblem is that these investors were not buying Bitcoin, the value of which hasgrown strongly this year. Instead, they acquired what he describes as ‘volatilityarbitrage shells’.DATsissue convertibles or fixed/moving-strike warrants that hedge funds buy atpremium terms and short the stock to delta hedge, generating significantrevenues. The DAT uses the proceeds to buy Bitcoin and retail investors buysthe stock, thinking it is just leveraged Bitcoin.Butwhen volatility compresses, hedge funds lose interest and issuance dries up.Coin accumulation stops and market net asset value collapses. Metaplanet’smarket cap fell from $8 billion to $3.1 billion despite holding $3.3 billion ofBitcoin.Asone crypto specialist put it, too many investors confuse Bitcoin exposure withexposure to leveraged structures built around the cryptocurrency and chaseBitcoin-linked instruments without realising they are stepping into avolatility trade.Thereis also the question of why an investor would put money into a DAT to gainexposure to Bitcoin when there are plenty of exchange-traded funds that performthis task more efficiently.Thesolution? Build the next generation of crypto-native public companies ontransparency and genuine alignment with the underlying asset.This article was written by Paul Golden at www.financemagnates.com.