Crypto isn’t just a trading story anymore. In the UK, senior MPs are calling for a ban on political donations made in crypto over fears of foreign interference, while in Washington, U.S. lawmakers are moving to shut down prediction markets that let people bet on war and death.
Different countries, different tools, but the same underlying worry: what happens when digital assets start flowing through the pipes of democratic politics?
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UK: a push to ban crypto political donations
In London, the chairs of seven parliamentary committees have written to Prime Minister Keir Starmer urging a clear ban on crypto donations to political parties and candidates.
They argue that even when contributions technically comply with UK rules, the pseudonymous and cross‑border nature of many crypto transactions makes it harder to verify who is really behind the money, raising the risk of “hostile foreign interference” in elections.
The MPs want an explicit legal prohibition on political donations made in cryptocurrency, stronger guidance from the Electoral Commission that only allows crypto contributions where there is “high confidence” about the true donor, and requirements for parties to convert any permitted crypto into pounds within about 48 hours while rejecting funds when the ultimate source cannot be identified.
For now, crypto donations remain technically lawful under UK rules, but between committee letters, ministerial warnings, and scandals over large crypto gifts to parties like Reform UK, the political momentum is clearly moving toward at least a moratorium, if not a full ban, until regulators feel they can police the risks.
US: war‑related “death bets” in the crosshairs
In the U.S., the flashpoint is different but related. After reports that traders made large profits by betting on the timing and scale of U.S. and Israeli strikes against Iran on platforms like Polymarket and Kalshi, Democratic lawmakers have launched a broad pushback against war‑linked and the so-called “death‑bet” contracts.
One centerpiece is the DEATH BETS Act, introduced by Representative Mike Levin and Senator Adam Schiff, which would amend the Commodity Exchange Act to explicitly bar any CFTC‑regulated exchange from listing contracts tied to terrorism, assassination, war, or an individual’s death.
Alongside that bill, senators including Chris Murphy have called for tighter limits on event contracts that hinge on sensitive government actions, arguing that they can turn inside information about military operations or national‑security decisions into tradable assets and create incentives to leak or manipulate outcomes for profit.
Supporters say allowing bets on war and death poses national‑security and ethical risks, while critics of a blanket ban counter that prediction markets can surface useful information about expectations, but that argument is running up against the political optics of “profiting from war.”
Beyond an “asset class”: crypto as political infrastructure
Put together, these fights show that regulators no longer see crypto and prediction markets as just another asset class.
In the UK, the focus is on political money flows: can crypto be used to route foreign or anonymous funds into campaigns in ways existing transparency rules can’t reliably catch?
In the U.S., the concern is about incentives and ethics: should anyone be allowed to profit directly from advance knowledge of military strikes or other life‑and‑death government decisions, especially on venues supervised by financial regulators?
Thinking that “regulators hate crypto” is easy, but they’re expectably starting to draw harder lines where digital money and markets intersect with democratic processes.
You can expect more rules, and more headlines, that treat crypto simultaneously as financial infrastructure to be integrated and as a potential vector for political and national‑security risk to be constrained.
Crypto market researcher and external contributor at Kriptoworld
Wheel. Steam engine. Bitcoin.
📅 Published: March 19, 2026 • 🕓 Last updated: March 19, 2026
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