UK Lawmakers Advocate Ban on Political Crypto Donations

Cabinet Office minister Pat McFadden told a parliamentary committee that the UK should ban political donations made in cryptocurrencies. McFadden spoke to a joint committee of MPs and peers examining national security issues.

McFadden said the Electoral Commission should review whether current rules can track the source of crypto donations. He noted the difficulty in verifying where digital currency contributions come from. The minister called for legislation to adapt to new technologies to maintain public trust in political funding.

The minister suggested increasing resources for the Electoral Commission and the National Crime Agency to monitor digital contributions properly. McFadden serves as a close ally of Prime Minister Keir Starmer.

Labour MP Liam Byrne, who chairs the Commons business and trade committee, asked McFadden to strengthen rules around contributions from unincorporated associations and companies with unclear finances. McFadden agreed that closing gaps in party funding laws, including cryptocurrency rules, would help protect democratic processes.

The discussion followed a report from anti-corruption group Spotlight on Corruption. The organization stated that allowing digital currencies in political finance could enable future interference schemes.

Two months ago, Nigel Farage's Reform UK party became the first British political party to accept Bitcoin donations. This followed similar practices during the 2024 U.S. presidential campaign.

The government plans to release a strategy paper on election reform that will strengthen rules on foreign interference. However, the paper is not expected to completely ban crypto contributions.

Ireland banned all digital currency donations in 2022. Several U.S. states have created similar restrictions to ensure transparency and compliance with election laws. The Electoral Commission currently requires political parties to report donations over £500 to the public. Parties must also verify that donors are eligible to make contributions under UK law.

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