Canada introduces bill banning cryptocurrency donations to politicians
Canada has introduced legislation to ban cryptocurrency donations to political parties, becoming the second G7 nation in a week to restrict digital asset contributions. The move follows the UK's moratorium and aims to prevent foreign interference in elections.
In the same week, two G7 countries moved to ban crypto donations to politicians in an attempt to prevent foreign influence on local political parties. Following the already confirmed moratorium on these donations in the UK, Canada's government introduced a bill that aims to do the same.
However, in addition to crypto assets, Bill C-25, or the Strong and Free Elections Act, also proposes prohibiting donations in the form of money orders, payment documents used as alternatives to cash or checks, and prepaid payment products, as these are also more difficult to track.
Meanwhile, if this type of contribution is received, it should be returned within 30 days or destroyed if that's not possible.
If neither is possible, the contribution should be converted "into money" and transferred to the Chief Electoral Officer, who shall forward that amount to the Receiver General, a government officeholder responsible for managing the federal treasury.
Needless to say, anonymous contributions are also prohibited.
When the act might come into force is unknown, as it was introduced and passed its first reading on March 26th.
While crypto donations were allowed since 2019, in 2024, the Chief Electoral Officer suggested banning them due to difficulties in tracking them. Officials cautioned that the pseudonymous nature of crypto could make it difficult to verify donor identities and prevent foreign interference.
However, the first attempt to ban cryptocurrency donations failed as Parliament was temporarily suspended in Q1 2025 in an attempt to reset the government’s agenda amid legislative gridlock.
In either case, last week, the UK banned crypto donations, claiming they are trying to prevent foreign actors from influencing local politicians. The moratorium is expected to last until the required regulation is introduced to help ensure these donations are transparent.
According to political observers, this moratorium particularly affects Nigel Farage, the leader of Reform UK, as the party has accepted millions in crypto donations.
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