Mr Smith purchases £50,000 of using say $100,000 on 1/1/2014.
Brexit comes along and all of a sudden on 1/1/17 Mr Smith realises he only needed $70,000 to acquire £50,000.
He cancels the option and takes a hit of $30,000 (i.e. $30,000 at .7142857 = £21,429).
I believe that this loss is capital in nature (please let me know if I'm wrong) but I am unsure how this would be shown on a return.
Any help or suggestions would be greatly appreciated.