UK Lawmakers Urge Ban on Crypto Donations in Upcoming Elections Bill

TLDR

• Seven senior Labour MPs urged Prime Minister Keir Starmer to ban crypto donations in the upcoming elections bill.
• The letter cites crypto’s traceability issues and risks of foreign interference as threats to democratic integrity.
• A 2022 U.S. report claimed Russia used over $300 million, including crypto, to influence elections globally.
• Only three UK political parties have reported receiving crypto donations under current laws.
• The call for action comes ahead of a review on foreign political funding, due in March.

Senior Labour MPs have urged Prime Minister Keir Starmer to ban cryptocurrency donations in the UK’s upcoming elections bill. The lawmakers warned that such contributions could be exploited by foreign entities aiming to influence domestic politics. They issued the request through an open letter signed by seven parliamentary committee chairs.

MPs Raise Security Concerns Over Crypto Donations

The letter, led by MP Liam Byrne, states that crypto is opaque, hard to trace, and a growing risk to democratic systems. Byrne wrote, “Crypto is opaque, hard to trace, vulnerable to foreign interference & a growing risk to democratic integrity.” The MPs asked the government to close this gap before new election laws are passed.

The letter references a 2022 U.S. intelligence report that accused Russia of using cryptocurrency to fund election interference worldwide. It stated that Russia spent over $300 million influencing elections using various financial channels, including crypto transfers. MPs argue that the UK must act now to prevent similar risks from spreading into its political system.

Currently, crypto donations are allowed in the UK, provided they follow the same rules as other financial contributions. Only three political parties have officially reported receiving crypto donations to date. Reform UK is one of the parties that have confirmed receiving such a donation.

Crypto Use in Politics Draws Closer Scrutiny

While Reform UK accepted crypto, the high-value donation from investor Christopher Harborne was not made using digital assets. Harborne donated £9 million ($12.1 million) to Reform UK in late 2023, but it came through fiat currency. The Electoral Commission has not detailed how much, if any, of the £24 million in Q3 donations were in crypto.

The letter arrives before a broader review on foreign political funding, which is being led by former civil servant Philip Rycroft. That review will examine international funding practices and their implications on the UK’s democratic institutions. The report is expected to be delivered by March.

Until then, lawmakers continue to press for stronger rules addressing the use of digital assets in politics. The government has not confirmed if it will address the crypto issue before the review’s completion. The letter urges preemptive action instead of waiting for the full recommendations.

The post UK Lawmakers Urge Ban on Crypto Donations in Upcoming Elections Bill appeared first on Blockonomi.