UK Lawmaker Calls for Pause on Political Cryptocurrency Donations

TLDR

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Matt Western called for suspension of political cryptocurrency donations due to foreign interference threats.
He requested ministers include a temporary suspension in the Representation of the People Bill.
Western expressed concerns about hostile nations using crypto to influence British political funding.
He suggested political parties only accept donations through Financial Conduct Authority-registered platforms.
He advocated for prohibiting contributions linked to mixing services or unidentified sources.

A prominent British parliamentarian has called on the government to suspend political cryptocurrency donations amid foreign interference concerns. Matt Western submitted an official letter on Monday to Housing Secretary Steve Reed detailing his recommendations. He requested that ministers incorporate a temporary suspension into the upcoming Representation of the People Bill.

Western serves as chair of the Joint Committee on the National Security Strategy and expressed alarm about electoral security threats. He cautioned that adversarial nations might leverage cryptocurrency channels to sway British politics. Accordingly, he advocated for immediate legislative measures ahead of the upcoming general election.

Temporary suspension of cryptocurrency contributions

Western pushed ministers to incorporate a “temporary moratorium” on cryptocurrency donations within the Representation of the People Bill. He suggested lifting the suspension after the Electoral Commission publishes statutory guidance. He explained, “We are concerned that a foreign state’s intent to interfere in UK political finance may extend to the next election.”

He connected the proposal to ongoing security challenges and Britain’s military involvement in Europe. He noted that swaying UK stances on Ukraine or relations with the US and EU could prove valuable to adversaries. Consequently, he urged the government to take action before the bill’s second reading on March 2.

During January, Western along with fellow committee chairs supported a complete prohibition on cryptocurrency donations. The bill presented on Feb. 12, however, omitted this ban. The upcoming UK general election must occur by Aug. 15, 2029.

Prohibit contributions from mixing services and unidentified sources

Western requested that the Electoral Commission mandate political parties to utilize cryptocurrency platforms registered with the Financial Conduct Authority. He stated parties should decline donations involving previous use of mixing services. He further indicated parties should turn away funds originating from unidentified sources.

He suggested that political organizations convert received cryptocurrency into fiat currency within 48 hours. He contended that transparent regulations would minimize the threat of illicit or foreign-connected contributions. He additionally advocated for mandatory source-of-wealth verification for contributors.

Western called for enhanced penalties for violations of electoral finance regulations. He pushed for a review of sentencing guidelines for associated offenses. He also requested expanded authority for the Electoral Commission to mandate disclosure of donation origins.

Reform UK and acceptance of Bitcoin donations

Western’s letter detailed broader enforcement reforms spanning multiple agencies. He noted that no unified national entity oversees political finance enforcement. He identified the Electoral Commission, Metropolitan Police, Counter-Terror Policing, National Crime Agency, MI5, and local forces.

He advocated for establishing a dedicated national police force to supervise political finance. He observed that authorities currently divide responsibilities among numerous entities. He commented that coordination deficiencies might obstruct oversight effectiveness.

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