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Some Members of Parliament in the United Kingdom, led by the chairman of the Joint Committee on National Security Strategy, Matt Western, are pushing for a temporary ban on political crypto donations due to concerns over foreign interference.<\/p>\n
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A letter<\/a> directed to the Secretary of State for Housing, Communities and Local Government, Steve Reed, has proposed a temporary moratorium on cryptocurrency donations to political parties until the Electoral Commission produces statutory guidance.<\/p>\n In the letter, Western raised concerns around \u201cforeign state intent to interfere in UK political finance\u201d as there is \u201cno clear national enforcement lead for political finance and foreign interference risk.\u201d<\/p>\n \u201cAs the security environment worsens and the UK\u2019s military role in Europe grows, the value of influencing the UK\u2019s political positions (for example, on Ukraine, or US\/EU relations) is likely to increase,\u201d Western said.<\/p>\n <\/p>\n He has urged the Electoral Commission to introduce interim safeguards, such as only allowing political parties to process crypto donations through Virtual Asset Service Providers registered with the Financial Conduct Authority, and accepting contributions where there is high confidence in identifying the ultimate source of the funds.<\/p>\n He also suggests prohibiting the use of crypto mixers or tumblers that can be used to obscure the provenance of assets, alongside a mandate that political parties should convert donations into pound sterling within 48 hours of receipt.<\/p>\n Further, Western recommended stricter source of wealth checks for donors and a review of sentencing for electoral finance offences, alongside higher penalties for breaches involving foreign money and expanded powers for regulators to pursue violations.<\/p>\n Last month, Western, along with a group of other committee chairs, lobbied<\/a> for a full ban on cryptocurrency donations by including a provision in the Representation of the People Bill. That, however, was not included in the legislation when the bill was introduced to the House of Commons on Feb. 12.<\/p>\n