The Reform UK party would become the first British political organization to receive Bitcoin donations.
UK Cabinet Office Minister Pat McFadden has urged election officials to contemplate the prohibition of political donations made in digital currencies in response to the increasing apprehension that foreign powers could exploit untraceable cryptocurrency to influence British politics.
McFadden informed MPs that tracing crypto donations is a difficult task and encouraged the Electoral Commission to evaluate the suitability of current regulations in the rapidly changing digital era.
In the wake of Nigel Farage’s declaration that his Reform UK party would become the first British political organization to accept Bitcoin donations, McFadden’s comments are reminiscent of the actions of Donald Trump’s 2024 campaign.
Crypto Donations May Facilitate Covert Foreign Interference in Politics.
Campaigners such as Spotlight on Corruption caution that these practices could facilitate covert foreign interference, undermining democratic processes.
During a joint Commons and Lords committee session on national security, Labour MP Liam Byrne pressed McFadden on the matter, prompting the minister to emphasize the necessity of legislative updates and transparency to safeguard the integrity of political financing.
Additional concerns were expressed regarding donations from “unlimited companies,” whose financial records are challenging to examine.
McFadden and Byrne concurred that it is imperative to enhance the resources of the Electoral Commission and the National Crime Agency to monitor political finances more effectively.
Byrne characterized the current party finance regulations as a “Kremlin’s charter,” prioritizing opacity. He advocated for prohibiting crypto donations and foreign money and implementing more stringent enforcement measures.
Despite McFadden’s remarks suggesting an openness to stricter crypto donation controls, government sources indicated that upcoming election reform proposals may not include an outright ban.
The upcoming strategy paper is anticipated to restrict the general foreign interference rules, extend them to digital currencies, and advocate for voter registration reforms, including lowering the voting age to 16 and protecting candidates from abuse.
Campaigners for transparency continue to express concern that the government may refrain from limiting donations or reinstating the Electoral Commission’s criminal investigation authority.
The debate over protecting UK democracy from evolving threats in the digital era continues as calls for stronger donation checks intensify, including those from democracy advocate Tom Brake and peer Margaret Hodge.
UK to Enforce Mandatory Crypto Trade Reporting
As part of a comprehensive initiative to enhance tax compliance and oversight in the digital asset sector, the United Kingdom will mandate that crypto firms collect and report comprehensive customer information on each transaction and transfer beginning January 1, 2026.
The new regulations will require platforms to record all users’ full names, residential addresses, and tax identification numbers, as per a recent statement from HM Revenue and Customs (HMRC).
Additionally, each transaction must be documented with specifics, including the cryptocurrency and the quantity transferred.
Companies, trusts, and charities that engage in crypto activity are subject to the reporting obligation, in addition to individual users.
Firms that neglect to comply or submit inaccurate data may be penalized up to £300 ($398) per user.
