UK to ban crypto political donations

The UK Government will ban cryptocurrency donations to political parties as part of a wider effort to tackle foreign interference in British democracy, Prime Minister Keir Starmer has confirmed.

The move follows a review led by senior civil servant Philip Rycroft, which examined the risks posed by overseas money entering UK politics. As reported by the BBC, ministers have accepted key recommendations, including a prohibition on crypto donations and a cap on contributions from British citizens living abroad.

Crypto donations seen as high risk

According to ministers, cryptocurrency transactions pose a particular threat because of their potential anonymity. Speaking in Parliament, Steve Reed said such donations could make it easier to obscure the true source of funds.

He warned that this creates “a clear route” for illicit money to enter the political system, undermining public confidence in elections. The ban on crypto donations will apply to contributions of any amount and will remain in place until stronger regulatory safeguards are introduced.

Cap introduced for overseas donors

Alongside the crypto ban, the government will limit political donations from British citizens living abroad to £100,000 per year. Any donations exceeding this threshold will need to be returned within 30 days once the rules take effect, or parties could face criminal penalties.

The new cap will apply across all UK elections, including upcoming local and devolved votes. Ministers plan to implement the changes through amendments to the Representation of the People Bill.

Reform UK and Farage respond

The issue has drawn particular attention because Reform UK is the only Westminster party known to have explored cryptocurrency donations. Its leader, Nigel Farage, previously said the party would accept Bitcoin contributions and confirmed it had already received a small number of such donations.

Farage criticised the government’s decision, arguing it risks excluding younger voters who are more likely to hold digital assets. He said cryptocurrencies are owned by around 25 percent of people under 30 and questioned whether the policy would limit democratic participation.

The party maintains that all its donations comply with existing rules, including checks on contributions over £500 to ensure they come from permissible sources.

Wider concerns over foreign influence

The review was commissioned following a series of high-profile cases involving foreign interference in UK politics. These included the conviction of former MEP Nathan Gill and an earlier security alert linked to alleged influence operations.

The report concluded that the threat from foreign money is “real and persistent”, highlighting the need for stronger safeguards. Additional proposals, such as banning foreign-funded online political advertising, are still under consideration by ministers.

Political tensions over funding rules

Recent donation data has intensified the debate. Electoral Commission figures show Reform UK received a record £9 million contribution from businessman Christopher Harborne, a British national based overseas. Fresh Electoral Commission data confirmed that it is the largest single donation ever made by a living individual to a UK political party.

Critics within Reform UK argue the government is moving quickly to restrict funding channels used by political rivals. Party figures have accused ministers of limiting lawful donations under the guise of reform.

Next steps for legislation

Starmer said the government would act “decisively” to protect the integrity of UK elections. While not all recommendations from the Rycroft review have been adopted yet, the crypto ban and overseas donation cap mark the first concrete steps in tightening political finance rules.

This comes after UK lawmakers pushed for a ban on crypto political donations as they raise questions about transparency and security. Cryptocurrency transactions, unlike typical bank transfers, can be quick, cross-border, and difficult to track, making it harder to verify whether contributions actually originate from reputable UK donors.

The chair of the United Kingdom’s national security committee, Matt Western, called for a temporary ban on cryptocurrency donations to political parties in February. After examining political financing issues, the committee, which consists of peers and MPs, concluded that the current security measures would not be sufficient to manage cryptocurrency transactions.