MPs Call for Temporary Ban on Crypto Donations
Members of Parliament have urged a temporary ban on political parties accepting donations in cryptocurrencies, citing concerns about potential foreign interference in British democracy.
While foreign donations are already prohibited in the UK, the government is preparing to strengthen regulations to enhance transparency.
However, anti-corruption advocates have raised alarms that crypto donations—which remain legal—could be exploited to conceal the true origin of funds.
In response, Parliament's joint committee on the national security strategy has written to the government requesting a temporary suspension of crypto donations until more robust regulations are established.
Currently, Reform UK is the only Westminster party known to have received cryptocurrency donations.
Nigel Farage announced in May last year at a crypto conference in Las Vegas that Reform UK would accept Bitcoin donations. By October, he stated the party had already received a "couple" of such contributions.
Reform UK's website states that it does not accept anonymous donations and that any contributions exceeding £500 undergo standard permissibility checks to verify that the funds originate from UK-registered companies or individuals listed on the electoral register.
The party has been contacted for comment.
Committee Demands Moratorium Until Clear Rules Are Set
The national security strategy committee is advocating for a "temporary moratorium" on crypto donations until the Electoral Commission issues formal guidelines on their acceptance.
In a letter addressed to Communities Secretary Steve Reed, committee chairman Matt Western emphasized that guidance should restrict parties to accepting crypto donations only when there is "high confidence" regarding the ultimate source of the funds.
"Political parties should have to convert the donation to pounds sterling within 48 hours," Western, a Labour MP, wrote, also calling for a ban on donations where the ultimate donor is obscured.
This recommendation follows the committee's inquiry into political finance and the risks posed by foreign interference.
MPs on the national security strategy committee expressed concern that foreign interference could escalate ahead of the next general election.
Western highlighted the deteriorating security environment, citing the ongoing war in Ukraine and tensions between the EU and US, which have "increased the value of influencing the UK's political positions."
"A corrosive belief that foreign interference could impact the democratic process presents a significant risk to long-term trust in institutions," Western warned in his letter to Reed.
The committee is also calling for stricter penalties for breaches of political finance laws, enhanced scrutiny of donors' wealth sources, and the establishment of a specialist police unit dedicated to foreign interference.
Government Proposals and Campaigners’ Demands
Last month, the government published the Representation of the People Bill, which includes measures to clamp down on illicit foreign donations and proposes lowering the voting age to 16.
Under these proposals, companies making political donations must demonstrate a genuine connection to the UK, such as being headquartered domestically, majority owned or controlled by UK electors or citizens, and generating sufficient revenue to cover the donation.
However, the bill does not currently include a ban on cryptocurrency donations.
Campaign groups like Spotlight on Corruption are urging the government to introduce such a ban during the bill's passage through Parliament.
A separate review into foreign interference in British politics, led by former senior civil servant Philip Rycroft, is focusing on cryptocurrency and is expected to report next month.
The government has been contacted for comment.
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