TRANSPARENCY campaigners have warned that “unlimited anonymous donations” could flow into UK politics as cryptocurrency adoption grows.
It comes as Reform UK have announced they will begin accepting donations in cryptocurrency.
Speaking at the Bitcoin Conference in Las Vegas yesterday, leader Nigel Farage pledged that his party would “launch in Britain a crypto revolution”.
Party chairman Zia Yusuf, meanwhile, told reporters on Friday that Reform UK had already received its first cryptocurrency donations, adding they were all compliant with Electoral Commission rules.
But anti-corruption organisation Transparency International has warned that the “integrity of our democratic process” is at risk unless the UK Government brings in reforms.
Cryptocurrency donations are allowed within current rules, as long as parties collect enough information to “properly check that each donation is from a permissible source”.
The EC website explains: “Cryptocurrencies are digital currencies that operate independently of any central bank or authority.
“The same rules apply to donations received in cryptocurrencies as any other donations. “Sufficient information must be collected to check permissibility. There must be a means of valuing the donation given in any cryptocurrency.”
Reform’s website also currently contains a disclaimer on the top of the payment page which reads: “Reform UK may accept a donation only from a permissible donor and where the identity of the donor is known.
“We ask you to provide information so that we can perform the required checks.”
But Steve Goodrich, head of research and investigations at the anti-corruption organisation, told The National that cryptocurrencies still pose a “serious challenge to UK political finance laws”.
“The anonymity offered by digital currencies makes it nearly impossible for political parties to have confidence in their donors' identities,” he said.
“Our current laws were designed to ensure transparency in political funding, but they were written before Bitcoin existed. Today, they appear increasingly outdated.”
Goodrich added: "As cryptocurrency adoption grows, we face a widening loophole that could allow unlimited anonymous donations to flow into British politics.
“The government urgently needs to act and bring forward legislation to address both traditional big money influence and the emerging threat of digital donations. Without reform, the integrity of our democratic process remains at risk."
