LONDON — British political parties will no longer be permitted to accept cryptocurrency donations, Prime Minister Keir Starmer announced Wednesday, warning that illicit finance poses a "stark" danger to the nation's democracy.
"We
will act decisively to protect our democracy" from outside meddling,
Starmer told lawmakers during the weekly Prime Minister's Questions session.
"That will include a moratorium on all political donations made through
cryptocurrencies."
The
move is expected to disproportionately affect Reform UK, the hard-right party
led by Nigel Farage, which is one of the few British parties to accept crypto
donations.
In
addition to the crypto ban, the government announced it would impose an annual
cap of £100,000 ($134,000) on donations from British voters living abroad.
According to Electoral Commission figures, Reform UK received £12 million over
the past year from Christopher Harborne, a British businessman based in
Thailand.
Following
Starmer's announcement, Reform UK lawmakers walked out of the House of Commons
chamber. Deputy leader Richard Tice accused the government of attempting
"to stop the incredible progress of Reform," adding that
cryptocurrencies are "a perfectly legitimate way of investing, of earning
within the law."
Reform
UK currently holds just eight of the 650 seats in Parliament but consistently
leads both Starmer's governing Labour Party and the main opposition
Conservatives in opinion polls.
Crypto Ban Follows
Review of Foreign Interference
Under
British law, political parties face strict limits on election spending but may
accept unlimited donations, provided donors are UK voters or companies
registered in Britain. A government-ordered review published Wednesday raised
concerns that untraceable digital currencies could be "used as the vehicle
to channel foreign money into the political system in the U.K."
The
review, led by former senior civil servant Philip Rycroft, recommended a
temporary ban on crypto donations until regulations catch up with the
technology. The government commissioned the review in December following
several high-profile incidents, including the jailing of former Reform UK
politician Nathan Gill for accepting bribes to make pro-Russian statements in
the European Parliament.
Rycroft
warned that "foreign interference in our politics is real and
persistent," noting that the UK remains a target for espionage from
Russia, China, and Iran. He also identified a "potential new threat: an
emerging willingness of foreign actors and private citizens, including from
allies like the United States, to interfere in, and influence, politics abroad
in pursuit of their own agenda."
The
changes announced by Starmer require parliamentary approval but will be
backdated to take effect Wednesday, according to the government. Rycroft made
additional recommendations, including a ban on foreign-funded online political
ads, which the government is still reviewing.
Starmer's
center-left government has previously introduced other measures aimed at
strengthening democracy, such as tightening corporate donation rules for
political parties and lowering the voting age from 18 to 16.