The Joint Committee on the National Security Strategy has urged the UK government to ban political donations in cryptocurrency, calling them an 'unnecessary and unacceptably high risk.' The committee wants a binding moratorium inserted into the Representation of the People Bill.
Experts warn that strict KYC rules could force parties to store centralized donor data-creating a major cybersecurity target. Kadan Stadelmann, founder of Komodo Blockchain, said such databases would be 'a massive honeypot' for adversaries.
The report highlights how privacy coins, mixers, and AI-driven micro-donations can evade transparency rules. Reform UK received $12 million in crypto last year, triggering scrutiny from Labour and the Liberal Democrats.
The committee urges stronger safeguards before any crypto donations are allowed.