MPs have called for a temporary ban on political parties receiving donations in cryptocurrencies over concerns about foreign interference in British democracy. Foreign donations are already banned in the UK and the government is planning to tighten up the rules to increase transparency. But anti-corruption campaigners have warned that crypto donations – which are currently legal – could be used to disguise the source of money. The proposal follows an inquiry by the committee into political finance and the risk of foreign interference.
The national security strategy committee is calling for a “temporary moratorium” until the Electoral Commission produces a set of rules on accepting crypto donations. In a letter to Communities Secretary Steve Reed, committee chairman Matt Western said guidance should limit parties to only accepting crypto donations where there can be “high confidence” about the ultimate source of the funds. Western, a Labour MP, said political parties should have to convert the donation to pounds sterling within 48 hours, and called for a ban on donations where the ultimate donor had been obscured. The committee is also calling for harsher sentences for those breaking laws on political finance, tougher checks on the source of donors’ wealth and a specialist police unit focused on foreign interference.
The government has set out plans to crack down on illicit foreign donations in its Representation of the People Bill, published last month, which will also lower the voting age to 16. The bill does not include a ban on donations in crypto currency. A review into foreign interference in British politics, led by former senior civil servant Philip Rycroft, includes a focus on crypto and is due to report next month. A Ministry of Housing, Communities and Local Government spokesperson said: “Through our Representation of the People Bill we are fighting against the risk of foreign interference by strengthening rules around political donations.” The spokesman also said the independent review would explore “how we can go even further to toughen up the safeguards in place against illicit money from abroad”, including cryptocurrencies.
MPs on the national security strategy committee say they are concerned that foreign interference could increase up to the next general election. The worsening security situation, with the ongoing war in Ukraine and tensions between the EU and US, increased “the value of influencing the UK’s political positions,” Western argues in his letter to Reed.
UK MPs on the national security strategy committee are urging a temporary moratorium on political parties accepting cryptocurrency donations amid concerns about foreign interference in democracy. While foreign donations are already banned and the government seeks greater transparency, critics warn crypto funding could obscure illicit sources. The panel calls for a pause until the Electoral Commission issues clear rules on accepting crypto gifts and requires high confidence in the donor’s identity. In a letter to Communities Secretary Steve Reed, committee chair Matt Western said parties should convert crypto donations to pounds within 48 hours and should bar gifts where the ultimate donor’s identity is obscured.
The committee also seeks tougher penalties for violations of political finance laws, enhanced checks on donor wealth, and a dedicated police unit to tackle foreign interference. The government has proposed tightening foreign donation controls in the Representation of the People Bill, which also lowers the voting age to 16, though the bill does not ban crypto donations. A separate review led by Philip Rycroft is examining foreign influence in British politics and is due to report next month, with officials indicating the review will probe safeguards for cryptocurrency funding.
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