The Conservative Party received a £500,000 donation from a UK crypto investor two months before the government vowed to make the UK the “very best place in the world” to build crypto businesses.
Christopher Harborne, a Thailand-based businessman, made the payment on February 9.
The government two months later announced its intention to make the UK a “global hub” for the crypto industry.
This renewed enthusiasm for crypto surprised some in the industry amid warnings from the Financial Conduct Authority and the Bank of England about the dangers of cryptocurrencies.
Andrew Bailey, Governor of the Independent Bank of England, has called cryptocurrencies “the new frontline” for criminal scams and warned that they have “no intrinsic value”. Since the government’s announcement in April, cryptocurrencies have plummeted, with Bitcoin’s price falling by more than half.
The BoE declined to comment on the matter.
The Conservative Party said there was no connection between Harborne’s donation and the government’s support for crypto. “Government policy is in no way influenced by party donations – they are completely separate,” said a party spokesman.
Harborne did not respond to requests for comment.
Tulip Siddiq MP, Labor secretary for the economy, described the donation as “a shocking revelation”.
“Rather than protecting the public through proper regulation of the crypto market, conservatives seem to have looked after the interests of their wealthy donors.
“This administration’s Wild West approach to crypto has threatened the security of people’s savings and crypto-related crime such as fraud and money laundering has reached record highs.”
The UK Treasury, which is responsible for planning around the crypto hub, has been contacted for comment.
In recent years, Harborne has become active in the crypto world. In 2020, he was named in EU filings as an accredited lobbyist for the Digital Currencies Governance Group, set up to “raise awareness of the role of digital currencies among European political representatives,” according to LobbyFacts analysis of EU filings . Members of the group include Bitfinex, a cryptocurrency exchange whose parent company Harborne was a shareholder, according to crypto news site Protos.
Harborne has not made any public statements regarding his crypto investments.
Bitfinex and DCGG have been contacted for comment.
In 2020, French business school Insead said Harborne gave the institution money to fund research into blockchain, the technology underlying most cryptocurrencies.
Bangkok-based Harborne is known as a generous donor to Reform UK, the former Brexit party, to whom he has donated more than £10m since 2019, according to filings with the UK Electoral Commission. He also donated a total of £489,000 to the Tories between 2001 and 2019.
The Conservative Party declined to comment to FN on whether the £500,000 payment in February was a one-off or the first of a planned series of donations.
Harborne’s donation was the second-highest the Tories received in the first quarter, after a £973,000 payment from JCB’s Mark Bamford, according to his regular filing with the Electoral Commission.
Harborne, a Cambridge graduate and former McKinsey consultant, is the owner of aviation fuel company AML Global. Last month he built a 7% stake worth £140million in Qinetiq, a Department of Defense research spin-off, through AML, a May 30 filing shows.
The UK’s Financial Conduct Authority has cracked down on crypto companies more harshly than regulators in some other leading countries, banning retail investors from trading in crypto derivatives and blocking the launch of exchange-traded crypto products.
Firms have complained about the difficulty of registering with the FCA to conduct crypto businesses, with many giving up and going abroad. In March, Treasury Secretary John Glen said he had told FCA chief executive Nikhil Rathi that the regulator needed to be “more responsive to crypto firms.”
However, it’s not just crypto firms that have complained about the regulators’ stance. Many mainstream city firms have also privately criticized the FCA’s approach, which some say has forced them to work on blockchain technology outside of the UK.
To contact the author of this story with feedback or updates, email David Wighton