UK committee chairs push for crypto political donations ban, adding pressure to Labour government

The chairs of seven parliamentary committees wrote to the UK government on Sunday urging an outright ban on cryptocurrency donations to political parties, escalating a months-long debate over digital assets in British electoral politics, per local reports.

The letter, signed by business and trade select committee chair Liam Byrne and six colleagues, argues that crypto donations undermine transparency, traceability and enforcement in political finance, according to The Guardian and The Observer.

“Crypto can obscure the true source of funds, enable thousands of micro donations below disclosure thresholds, and expose UK politics to foreign interference,” Byrne said in a statement to The Guardian. “The Electoral Commission has warned that current technology makes these risks exceptionally hard to manage.”

The intervention adds pressure to the Labour government, which has been weighing a ban on crypto political donations since at least July 2025, when Cabinet Office minister Pat McFadden first raised the idea publicly. Government sources told The Guardian that ministers believe cryptocurrency donations pose a risk to electoral integrity because verifying their source is difficult, but the complexity of implementing restrictions means a ban won’t be included in the Elections Bill expected to be published shortly.

Reform UK leader Nigel Farage announced in May 2025 that his party would become the first in the UK to accept bitcoin and other cryptocurrency donations, positioning the move as part of a broader “crypto revolution” that would include a UK bitcoin reserve and capital gains tax cuts if the party wins power. The party received the UK’s first-ever registered crypto donation last fall, though no official declaration of its value has been made public.

The debate around crypto donations intensified in December when Electoral Commission filings revealed that Reform had received a record £9 million ($12 million) donation from Christopher Harborne, a Thailand-based crypto investor who holds an estimated 12% stake in Tether. While that particular donation was made in fiat currency rather than crypto, Harborne’s wealth is derived substantially from his cryptocurrency holdings, prompting Labour and the Liberal Democrats to call for regulatory investigations into potential conflicts of interest.

The push for restrictions comes as the UK advances its broader crypto regulatory framework. In December, Parliament passed legislation recognizing digital assets as a form of property, and the government has outlined plans to regulate crypto like traditional financial products by 2027. The Financial Conduct Authority has been developing a comprehensive regime covering stablecoins, trading platforms, lending and staking, with full implementation expected in 2026.

The proposed crypto donation restrictions would mark a departure from the approach in the United States, where crypto-backed political action committees spent more than $190 million during the 2024 election cycle under Federal Election Commission reporting rules. Several US states have banned crypto donations entirely, but no federal prohibition exists.