diff --git a/compiler/src/dotty/tools/dotc/core/quoted/PickledQuotes.scala b/compiler/src/dotty/tools/dotc/core/quoted/PickledQuotes.scala
index 74c8aa1d2d3b..7f6341b70b44 100644
--- a/compiler/src/dotty/tools/dotc/core/quoted/PickledQuotes.scala
+++ b/compiler/src/dotty/tools/dotc/core/quoted/PickledQuotes.scala
@@ -11,6 +11,7 @@ import dotty.tools.dotc.core.StdNames._
 import dotty.tools.dotc.core.NameKinds
 import dotty.tools.dotc.core.Symbols._
 import dotty.tools.dotc.core.Types.Type
+import dotty.tools.dotc.core.tasty.TreePickler.Hole
 import dotty.tools.dotc.core.tasty.{TastyPickler, TastyPrinter, TastyString}
 
 import scala.quoted.Types._
@@ -25,6 +26,7 @@ object PickledQuotes {
   def pickleQuote(tree: Tree)(implicit ctx: Context): scala.runtime.quoted.Unpickler.Pickled = {
     if (ctx.reporter.hasErrors) Nil
     else {
+      assert(!tree.isInstanceOf[Hole]) // Should not be pickled as it represents `'(~x)` which should be optimized to `x`
       val encapsulated = encapsulateQuote(tree)
       val pickled = pickle(encapsulated)
       TastyString.pickle(pickled)
diff --git a/compiler/src/dotty/tools/dotc/transform/ReifyQuotes.scala b/compiler/src/dotty/tools/dotc/transform/ReifyQuotes.scala
index a4844b9d3ea7..0f8276eefbfd 100644
--- a/compiler/src/dotty/tools/dotc/transform/ReifyQuotes.scala
+++ b/compiler/src/dotty/tools/dotc/transform/ReifyQuotes.scala
@@ -348,7 +348,12 @@ class ReifyQuotes extends MacroTransformWithImplicits with InfoTransformer {
      */
     private def quotation(body: Tree, quote: Tree)(implicit ctx: Context): Tree = {
       val isType = quote.symbol eq defn.typeQuoteMethod
-      if (level > 0) {
+      if (body.symbol.isSplice) {
+        // simplify `'(~x)` to `x` and then transform it
+        val Select(splice, _) = body
+        transform(splice)
+      }
+      else if (level > 0) {
         val body1 = nested(isQuote = true).transform(body)
         // Keep quotes as trees to reduce pickled size and have a Expr.show without pickled quotes
         if (isType) ref(defn.typeQuoteMethod).appliedToType(body1.tpe.widen)
diff --git a/tests/run-with-compiler/quote-nested-2.check b/tests/run-with-compiler/quote-nested-2.check
index 5e2472b8ba28..aea924902147 100644
--- a/tests/run-with-compiler/quote-nested-2.check
+++ b/tests/run-with-compiler/quote-nested-2.check
@@ -1,4 +1,4 @@
 {
   val a: quoted.Expr[Int] = <special-ops>.'[Int](4)
-  <special-ops>.'[Int](a.unary_~)
+  a
 }
diff --git a/tests/run-with-compiler/quote-nested-5.check b/tests/run-with-compiler/quote-nested-5.check
index 5e2472b8ba28..aea924902147 100644
--- a/tests/run-with-compiler/quote-nested-5.check
+++ b/tests/run-with-compiler/quote-nested-5.check
@@ -1,4 +1,4 @@
 {
   val a: quoted.Expr[Int] = <special-ops>.'[Int](4)
-  <special-ops>.'[Int](a.unary_~)
+  a
 }
diff --git a/tests/run/quote-simple-hole.scala b/tests/run/quote-simple-hole.scala
new file mode 100644
index 000000000000..2fcb905abc3e
--- /dev/null
+++ b/tests/run/quote-simple-hole.scala
@@ -0,0 +1,13 @@
+object Test {
+  def main(args: Array[String]): Unit = {
+    val x = '(0)
+    val y = '(~x)
+    val z = '(~('(~y)))
+    assert(x eq y)
+    assert(x eq z)
+
+    val i = '[Int]
+    val j = '[~i]
+    assert(i eq j)
+  }
+}