The UK government has implemented urgent legislative changes to restrict political donations in cryptocurrency.
Under the new rules, British citizens living abroad will face an annual limit of £100,000. The measures also include a ban on contributions in digital assets, aimed at "preventing malicious actors from using untraceable methods to influence elections."
"The ban on cryptocurrency donations is vital. The UK will become a global leader in combating this growing threat to freedom, and we will stop hostile foreign states and others who wish to undermine and exploit the UK by sowing division and hatred. It is our patriotic duty to protect the British people's right to freely choose their government," said Steve Reed, Minister for Housing, Communities and Local Government.
The provisions took effect on March 25. Amendments to the Representation of the People Act were required to implement them.
All cryptocurrency donations received after this date must be returned to the sender within 30 days; otherwise, authorities will take enforcement action.
The government note does not specify the penalties for violating the new rules.
These changes were reportedly made following the release of an independent report on foreign financial interference in the UK's political and electoral systems.
Background
According to News Sky, the investigation was initiated by former senior official Philip Rycroft. His report highlighted a "persistent problem of foreign interference," which could be "malicious" and "foment discontent."
However, Rycroft acknowledged that there is "no immediate crisis" or evidence of violations during the 2024 election period.
Nonetheless, UK Prime Minister Keir Starmer quickly responded to the report with legislative changes.
"We will act decisively to protect our democracy," he stated.
Journalists noted that the leader of the opposition party Reform UK, Nigel Farage, complained about the law's bias. He believes the provisions are designed to harm his organization, which receives a significant portion of its funding from overseas sources.
In February, the UK Treasury appointed HSBC to conduct a pilot issuance of digital government bonds.