Seven senior Labour MPs have asked Prime Minister Keir Starmer to prohibit cryptocurrency donations to political parties, urging the government to include a ban in an elections bill expected later this month, according to The Observer and The Guardian.
In a letter sent on Sunday, Labour Party MPs who chair several parliamentary committees urged the government to include a prohibition on crypto donations in an elections bill expected to be introduced later this month.
The push comes ahead of local elections scheduled for May.
Lawmakers raise concerns over transparency and foreign influence
The group of seven, all committee chairs, wrote to Starmer calling for “explicit provision to disallow cryptocurrency donations to political parties and politicians,” The Observer reported.
The signatories are Liam Byrne, Emily Thornberry, Tan Dhesi, Florence Eshalomi, Andy Slaughter, Chi Onwurah and Matt Western.
Business and trade committee chair Liam Byrne, one of the signatories, said political financing “must be transparent, traceable and enforceable,” arguing that cryptocurrency does not meet those standards.
The UK should not delay its response to this situation, according to Byrne, who stated, “This is not about opposing innovation. It is about protecting democracy with rules that work in the real world.”
He added that if the elections bill does not include a ban, he will move amendments, saying “anonymous money has no place in British democracy. ”
The committee’s concerns, as outlined in the open letter, include the potential for foreign influence through crypto donations, the use of technologies that fall outside UK regulatory frameworks, and the role of artificial intelligence in further masking the origins of funds.
Emily Thornberry said a prohibition would protect UK democracy, adding, “The FAC has been studying threats to democracy around the world, and we’ve learnt that crypto is the Russian slush fund of choice.”
Government stance and timing
The government has announced this initiative before the upcoming May local elections.
The government has previously indicated that more details on its approach would be released when the Elections Bill is published, according to The Observer.
However, The Guardian reported that officials believe a crypto ban will not be workable to include in the upcoming bill, which will lower the voting age to 16, due to the complexity of cryptocurrency.
The former senior civil servant Philip Rycroft is evaluating foreign financial entities that interfere with UK political processes while concentrating on crypto assets.
The review process will continue until March 2026, according to local news sources.
Reform UK in the spotlight
The proposed ban could affect Reform UK, which said in May it would be the first party in the country to accept digital-asset donations as leader Nigel Farage set out a pro-crypto stance, including advocating for a Bitcoin (BTC) reserve, The Guardian reported.
The party website indicates that it prohibits all cryptocurrency donations, which remain untraceable to donors.
Reform UK also received a record 9 million British pounds ($12 million) donation in cash from early crypto investor Christopher Harborne in December, described as the largest single political gift ever made by a living person in Britain.
The donation was disclosed in line with UK electoral law, according to The Guardian.
Broader backing for tighter rules
The support for restrictions continues to increase between Westminster institutions and civil society organizations.
Senior Labour MP Pat McFadden first floated a ban in July, saying it is important to know who provides a donation and whether they are properly registered.
The UK Anti-Corruption Coalition, together with other advocacy groups, supported a donation ban during the previous month because they argued crypto donations violated official warnings about foreign interference and illegal financial activities.
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