Reform’s murky crypto links could make you poorer, experts warn

Two billionaire backers with fortunes forged in cryptocurrency have delivered an unprecedented £72m windfall to Reform UK. They say the cash is about “levelling the playing field,” but economists warn that the party’s crypto agenda could backfire—driving up government borrowing costs, taxes, and mortgage rates, and ultimately leaving households worse off.

The crypto tycoons bankrolling Reform

Ben Delo, 42, co-founded BitMEX, a crypto derivatives exchange credited with popularising perpetual futures—a defining innovation of the Bitcoin era. He once likened the platform’s leap to moving traders from a horse-and-buggy to a Ferrari. A double-first Oxford graduate in maths and computer science, he worked at IBM and in finance before relocating to Hong Kong. In 2022, he paid a $10m penalty in the United States in a case related to BitMEX’s compliance with anti-money-laundering rules. He has since focused on philanthropy, including maths education and neurodiversity, saying he is driven by “rationalism” and “the pursuit of truth.”

Christopher Harborne, 63, an investor across sectors such as aviation and defence, holds a substantial stake—reportedly around 12%—in Tether, issuer of the world’s most-traded stablecoin. He has described stablecoins as a bridge between traditional finance and rapid, low-cost digital transfers, enabling immediate and largely frictionless cross-border movement of value. Both Harborne and Delo, who share roots near Sheffield, have donated £36m each to Reform—record sums in UK politics—positioning the party as a challenger with serious financial firepower.

Reform’s plans for digital assets

Reform and its leader have championed making the UK a premier hub for crypto and digital finance, arguing the sector has been stifled by bureaucracy and vested interests. Previous policy outlines included:

• Cutting capital gains tax on crypto profits to 10%.
• Building a sovereign reserve of Bitcoin.
• Allowing HMRC to accept tax payments in Bitcoin and other approved cryptoassets.

Party figures have since indicated that the details are under review, while maintaining a broadly positive stance toward crypto and advocating relatively light taxation.

Why economists say you could end up paying the price

Economists caution that proposals such as adding Bitcoin to the UK’s reserves risk undermining confidence in public finances and the institutions that guard them. Their key concerns include:

• Volatility risk: Bitcoin’s dramatic price swings make it a poor candidate for a central bank or Treasury balance sheet, threatening credibility and macroeconomic stability.
• Higher borrowing costs: Investors could demand a bigger premium to hold UK government debt if they view policy as riskier, pushing up gilt yields. That increases the state’s interest bill—costs ultimately borne by taxpayers—raising the likelihood of tax hikes or spending cuts.
• Mortgage pain and tighter credit: Rising gilt yields often feed through to higher lending rates. Households could face more expensive mortgages, and small businesses could see dearer loans just as they need affordable credit to invest and grow.
• Currency and inflation pressures: A credibility shock can weaken sterling, making imports more expensive. That fuels inflation and may force interest rates higher for longer, compounding pressure on households and firms.

Special tax breaks are another flashpoint. Analysts describe a bespoke 10% capital gains tax rate for crypto as “silly,” arguing it would attract speculative flows at the expense of investment in sectors such as housing, infrastructure, and productive enterprise—while reducing Treasury revenues. The result, they say, is a wider deficit that must be covered by higher taxes elsewhere or cuts to public services.

Supporters vs. sceptics

Reform’s donors say their contributions come with no strings attached, and supporters argue that pro-innovation rules can attract capital, talent, and high-value jobs. Proponents of a lighter regulatory touch believe the UK can seize a competitive edge by welcoming digital assets into the financial mainstream.

But many economists counter that there is a critical difference between enabling private innovation and putting taxpayer resources or national credibility on the line. In their view, tying fiscal plans to highly volatile assets or carving out ultra-low tax rates for speculative income is a gamble that risks leaving ordinary Britons poorer—through higher borrowing costs, pricier mortgages, weakened public services, and potentially higher taxes down the line.

The debate is not about whether crypto belongs in the UK economy—it already does—but about how to balance innovation with stability. On that test, experts warn, the most eye-catching parts of Reform’s past crypto blueprint look less like a growth plan and more like a risk to the country’s financial foundations.