HM Revenue and Customs (HMRC) sent more than 81,000 letters warning cryptocurrency holders they may owe capital gains tax in the past year.

A Freedom of Information (FOI) request seen by the BBC showed the number of letters sent by the tax authority had almost tripled since 2024.

Investors could face fines or prosecution if they fail to declare profits they made from selling, even if they exchange one cryptocurrency for another.

New powers due to be given to HMRC next year will make it easier to target wealthy crypto investors, with one analyst saying investigations will be like “shooting fish in a barrel”.

“There is the expectation amongst tax authorities that cryptocurrency investment is rife with tax evasion,” says Neela Chauhan, partner at UHY Hacker Young – which carried out the FOI.

“A lot of the traders are young, have had little previous exposure to HMRC and often work under the assumption that HMRC has limited visibility over their activities.”

In the 2025-26 financial year, HMRC sent 81,172 warning letters, emails and text messages to crypto investors it suspects may have underpaid tax.

The number in 2023-24 was just 27,714.

An HMRC spokesperson said: “We’re committed to helping people pay the right amount of tax, and the vast majority do.

“We regularly send letters to educate, remind or prompt customers to review their tax affairs, including customers who use crypto assets.”

The value of cryptocurrencies such as Bitcoin and Ethereum has fallen in the past year, but HMRC suspects there are still large amounts of unpaid capital gains from the rise in cryptocurrency values between December 2022 and October 2025.

During this time, the price of Bitcoin shot up from around £14,000 to £90,000.

Accountants are urging investors to check whether they owe money, as upcoming powers will make it easier for HMRC to target individuals.

From March 2027, cryptocurrency platforms located in dozens of countries outside the UK will be obliged to share information about their customers with tax authorities.

HMRC said the new powers would force “crypto bros to pay their fair share of tax” when the rules were announced last year.

The tax office estimated the changes would help raise up to £315m by April 2030, adding that this was the same amount needed to fund more than 10,000 newly qualified nurses for a year.

“Once HMRC has this data, tax investigations into cryptocurrency investors will be like shooting fish in a barrel,” warned Ms Chauhan.

In the last year, the price of Bitcoin has fallen to around £48,000.

Sign up for our Tech Decoded newsletter to follow the world’s top tech stories and trends. Outside the UK? Sign up here.