UK Security
There are fundamental issues with the political donation system, regardless of which currency is used, says Keatinge. And some have been amplified by the arrival of crypto, which is also creating fresh risks. The crypto concern: Of particular concern is the ability of Electoral Commission (them again!) to trace the origins of cryptocurrency. “The current system relies very heavily on the traditional anti-money laundering checks that banks do,” he says. “If you’re going to make payments with a token that doesn’t touch the banking system, then all the traditional checks you rely on are redundant.” Keatinge gives one major example. “The idea is that you essentially would use a permissible donor as a cutout, and would use them to launder money into the political financing system in the U.K,” he explains. “That individual is then renting a sort-of money mule,” he added. “Chances are no one is going to say: ‘well, where did that money come from?’” And so: The RUSI expert is pushing that moratorium until there’s a better picture of the risks. “At the moment they’re simply saying the system works, and if they add crypto into the mix, it still works. You can’t copy and paste existing regulations and apply it to crypto if the crypto risk profile is different. I’m not saying crypto is more risky or less risky, it’s a different risk profile and a different process.”
