A committee of seven senior Labour MPs has urged the UK government to impose a total ban on crypto donations to political parties.
The committee wrote to Prime Minister Kier Starmer to use the upcoming elections bill to make “explicit provision to disallow cryptocurrency donations to political parties and politicians.” In the open letter, the backbenchers have raised several concerns that emerged during committee evidence sessions.
According to The Observer, the red flags include foreign influence on elections through the use of crypto, application of technologies that fall outside UK regulations, and the influence of AI in further obscuring the source of funds.
The committee chairs include former minister Liam Byrne, Emily Thornberry, Tan Dhesi, Florence Eshalomi, Andy Slaughter, Chi Onwurah and Matt Western.
Pressures Mount to Restrict Crypto Donations to UK Political Parties
The British government’s plans to outright ban the use of crypto in political contributions aren’t new. The government said last month that more details about the plan would be released when the Elections Bill is published.
Besides, the government intensified the ban after the political party Reform UK received its biggest crypto donation of £9 million ($12 million).
Crypto investor Christopher Harborne donated heavily ahead of local elections in May, the Electoral Commission figures show.
Further, former senior civil servant Philip Rycroft is reviewing foreign financial interference in UK politics, which includes a focus on crypto. However, it is not expected to conclude until March 2026, local reports noted.
“Anonymous Money Has No Place in British Democracy”: Liam Byrne
Liam Byrne, who chairs the business and trade select committee, stressed that the Labour MPs’ committee is concerned that political finance “must be transparent, traceable and enforceable,” the Guardian reported Sunday.
“Crypto can obscure the true source of funds, enable thousands of micro donations below disclosure thresholds, and expose UK politics to foreign interference,” he said.
He added that the UK must not wait until a scandal erupts, making clear that the call is not against innovation.
“If the elections bill doesn’t ban cryptocurrency donations, I will move amendments to make sure it does, and I know scores of MPs will back it. Anonymous money has no place in British democracy.”
Another senior Labour backbencher, Emily Thornberry, who chairs the foreign affairs committee, said that banning crypto would protect the UK’s democracy.
“The FAC has been studying threats to democracy around the world, and we’ve learnt that crypto is the Russian slush fund of choice,” Thornberry added.
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