Starmer forced to water down Labour reforms as Brighton conference opens amid internal party battle

Published

3 years ago

September 25, 2021

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Sir Keir Starmer has been forced to water down his planned overhaul of Labour rules at the opening of the party’s conference in Brighton, as he was accused of an “almost pathological fear of democracy” in pushing for change.

The Labour leader had sought to use the Brighton gathering to alter the rules on how the party elects future leaders, including an abandonment of the system that saw Jeremy Corbyn twice elected to the party’s leadership.

However, amid opposition from trade unions and deep unhappiness from Labour’s left wing, Sir Keir watered down his package of reforms as his first in-person conference as Labour leader was threatened with being overshadowed by more internal party battles.

Sir Keir’s retreat on party rule changes included abandoning his proposal to return to an “electoral college” – made up of unions, affiliate organisations, MPs, and party members – for electing leaders and their deputies.

But Sir Keir did manage to get some reforms accepted by Labour’s ruling National Executive Committee (NEC) at the start of the Brighton conference on Saturday.

These included:

• Increasing the threshold of support (from 10% to 20% of MPs) a leadership hopeful must secure before becoming an official candidate in a leadership contest

• Scrapping the “registered supporters” scheme which allowed people to pay £25 to vote in a Labour leadership election

• Making it harder for current MPs to be de-selected by raising the threshold for triggering a selection contest

Those rule changes approved by the NEC are set to be voted on Labour members in Brighton on Sunday.

And parts of Labour’s left wing have already vowed to continue their opposition to Sir Keir’s proposed reforms.

Mish Rahman, a senior figure from the Momentum group who sits on the NEC, said: “Changing the threshold like this will destroy the right of ordinary people to shape the future of the party.

“If this rule change passes, Labour will be well on its way to becoming the party of the Westminster elite.

“If the 20% threshold applied to the 2020 leadership election it would have been a contest between Sir Keir Starmer QC and Sir Keir Starmer QC.”

And Labour’s former shadow chancellor John McDonnell, a long-time ally of Mr Corbyn, said: “These desperate attempts to restrict the influence of party members demonstrate an almost pathological fear of democracy amongst the Labour leadership and bureaucracy.

“Defeated on their main attack on democracy they now pick away wherever they can.”

As Labour’s factions continued their battle over the party’s rulebook in Brighton, the party’s national campaign coordinator Shabana Mahmood told Mr McDonnell he “ought to know better”.

“Because actually a leader should be able to command the respect of at least one fifth of their colleagues in order to be a functioning political party in parliament, in order to try and become the government of this country,” Ms Mahmood told Sky News.

“If you can’t even persuade your colleagues who you would one day hope to be your ministers, your supporters in your own government, then how can you possibly say to the county ‘make me prime minister’?

“Keir is sending a clear message to the country that we are a serious political party, we are committed to being a functioning force in parliament, we are committed to trying to be the government of this country.

“And I’m afraid to say those who don’t like this package of measures perhaps had other reasons for what they expect a political party to be.

“We are not any one man or one woman’s fan club, we’re a serious political party and under Keir’s leadership we’re going to try and be the government of this country.”

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Sir Keir himself said he was “very pleased” that his revised package of reforms had been backed by the NEC.

“These proposals put us in a better position to win the next general election and I hope constituency and trade union delegates will support them when they come to conference floor,” the Labour leader said.

Are Starmer and Rayner a new Labour odd couple?

By Jon Craig, chief political correspondent, in Brighton

Sir Keir Starmer looked a little embarrassed when his deputy, Angela Rayner, paid him a tribute during her barnstorming speech at the start of Labour’s conference.

“What a contrast our leader is to the current prime minister,” she said. “Ours has a lifetime of public service. Theirs a lifetime of self-service.”

Sitting a few feet away, the Labour leader smiled awkwardly. And their hug at the end of her speech looked even more awkward and was rather half-hearted.

The relationship between Labour’s top two is awkward, too. Labour’s odd couple? Maybe. But the party is used to those: Blair-Prescott, Corbyn-Watson.

But has Ms Rayner forgiven Sir Keir for attempting to strip her of many of her responsibilities after Labour’s humiliating by-election defeat in Hartlepool in May? Almost certainly not.

And her support for her leader in the run-up to Labour’s conference and here in Brighton as he attempted to re-write Labour’s rulebook was at best lukewarm and at worst non-existent.

She either had little enthusiasm for his proposed changes or didn’t see why she should lift a finger to help after his treatment of her in May.

The Starmer inner circle will have been annoyed, too, by her glossy photo-shoot and interview in The Times’ Saturday magazine in which she said she’d like a tilt at the Labour leadership one day.

The end result of the turbulent past few days is that without his deputy’s strong and vocal backing for his reforms, Sir Keir was forced into a humiliating retreat and major concessions and has been left looking seriously weakened.

Sir Keir’s first in-person conference is widely viewed as hugely important to the Labour leader’s hopes of shaking off his critics and offering hope that he can lead them to victory at the next general election.

But there were signs some at the conference were unwilling to move on from Sir Keir’s predecessor.

Labour general secretary David Evans faced heckles of “Oh Jeremy Corbyn!” as he asked members from the conference stage why they joined the party.

Yet Mr Evans later won a vote he called himself on his position, suggesting both he and Sir Keir retain the support of a majority of members in Brighton over their efforts to reform Labour’s structures.

Among those who have been touted as a possible replacement for Sir Keir, Labour’s deputy leader Angela Rayner used a pre-conference newspaper interview to confirm she would be willing to stand as a leadership candidate in the future.

“I think a lot of the time, especially when women get asked this question, we say ‘oh no, no, that’s not what we want’,” she told Sky News.

“And it makes us look like we’re not ambitious. I want every woman in this country to be ambitious.”

In her conference speech on Saturday, Ms Rayner spoke of her ambition to be deputy prime minister in a future Labour government as she unveiled Labour’s plans to boost employment rights.

And she compared the current post-COVID pandemic situation to the post-Second World War choices facing British voters.

“In 1945, the country faced a choice between a Tory government who sought the credit for our shared achievement but longed for the status quo that preceded it, where the state would step back and the market would rule again, where people knew their place and took what they were given,” she said.

“Or a Labour government that would harness the values that saved a nation, and make a country fit for those who had fought for it.

“Our country chose to face that future. Now conference, let us face the future again.”

Politics

Congress repealed the IRS broker rule, but can it regulate DeFi?

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3 hours ago

March 14, 2025

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Congress repealed the IRS broker rule, but can it regulate DeFi?

The decentralized finance (DeFi) industry is breathing a sigh of relief as Congress relaxes reporting obligations, but questions remain about how lawmakers will regulate DeFi.

On March 12, the House of Representatives voted to nullify a rule that required DeFi protocols to report gross proceeds from crypto sales, as well as info on taxpayers involved, to the Internal Revenue Service (IRS).

The rule, which the IRS issued in December 2024 and wasn’t set to take effect until 2027, was regarded by major industry lobby groups as burdensome and beyond the agency’s authority.

The White House has already signaled its support for the bill. President Donald Trump is ready to sign when it reaches his desk. But DeFi observers note that the industry has yet to strike a balance between privacy and regulation.

Privacy concerns over IRS DeFi rule

The crypto industry was quick to laud the vote in the House. Marta Belcher, president of the Filecoin Foundation, said that blocking the rule was particularly important for user privacy.

She told Cointelegraph it is “critical to protect people’s ability to transact directly with each other via open-source code (like smart contracts and decentralized exchanges) while remaining anonymous, in the same way that people can transact directly with each other using cash.”

Privacy concerns were central to the crypto industry’s objections to the rule, with industry observers claiming that it was not fit for purpose and infringed on user privacy.

Bill Hughes, senior counsel and director of global regulatory matters for Consensys Software wrote in December 2024, “Trading front ends would have to track and report on user activity — both US persons and non-US persons […] And it applies to the sale of every single digital asset — including NFTs and even stablecoins.”

The Blockchain Association, a major crypto industry lobby group, stated that the rule was “an infringement on the privacy rights of individuals using decentralized technology” that would push DeFi offshore.

While the rule has been stopped for now, there still aren’t fixed privacy guidelines in place — something Etherealize CEO Vivek Raman said the industry needs to move forward.

“There needs to be clear frameworks for blockchain-based privacy while maintaining [Know Your Customer/Anti-Money Laundering] requirements,” he told Cointelegraph.

Raman stated that some transactions and customer data will need to remain private, “and we need guidance on what privacy can look like.”

How do you regulate DeFi?

The crypto space has long juggled user privacy demands and regulators’ Anti-Money Laundering and Know Your Customer concerns.

One problem lies in the technology itself — if a network is created by many and controlled by no single entity, who can the government contact?

Per Raman, “It’s hard for a decentralized protocol that is controlled by nobody to issue 1099s or fulfill broker-dealer responsibilities! Companies can certainly be [broker-dealers], but software has not been designed for [broker-dealer] rules.”

DeFi developers can and have been proactive in working with regulators, Chainalysis suggested, as was the case with certain protocols freezing funds after the disastrous $285 million KuCoin hack.

Cinneamhain Ventures partner and consultant Adam Cochran claimed that every protocol has certain pressure points regulators could press on if a protocol were used to commit a crime:

Law, Congress, Privacy, US Government, Donald Trump, Features, Policy — *Source:* *Adam Cochran*

However, these specific instances do not make a comprehensive regulatory framework that both the industry and investor protection agencies can point to.

In that regard, crypto analytics firm Chainalysis stated in 2020 that regulators may need to craft regulations for the DeFi space with decentralized reporting limitations in mind.

Raman suggested that one possible solution could be zero-knowledge proofs, which allow users to confirm certain data without revealing it.

He is optimistic about regulators’ ability to find a way to regulate the space while still maintaining user privacy: “I think we’ll see a positive sum environment where DeFi and compliance will coexist.”

The long-awaited crypto regulatory framework

Trump has already made a number of pro-crypto measures through executive orders and appointing pro-crypto individuals to head parts of his administration — the most recent being the establishment of a strategic Bitcoin reserve.

The pro-crypto tenure of important financial regulators like the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) has dropped a number of high-profile enforcement cases against crypto firms.

While notable, the big fish that the crypto industry is waiting for is the crypto regulatory framework and stablecoin bills circulating in Congress, which would give the industry the guardrails it claims it needs to thrive.

On March 13, the Senate Banking Committee approved the GENIUS Act, the stablecoin bill, putting it one step closer to a vote on the Senate floor.

The crypto framework bill, FIT 21, was first introduced in the 2024 legislative session, ultimately failing in the Senate. However, in February, House Financial Services Committee Chair French Hill said that he anticipated the bill could pass in this session with “modest changes.”

But even if FIT 21 were passed soon, regulations for DeFi could be far off. The bill would exclude DeFi from SEC and CFTC oversight, but it would also establish a working group to research 12 key areas related to DeFi.

This study will seek to understand the risks and benefits of DeFi and will ultimately make regulatory recommendations.

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Hong Kong fintech sector sees 250% blockchain growth since 2022

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5 hours ago

March 14, 2025

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Hong Kong fintech sector sees 250% blockchain growth since 2022

Hong Kong anticipates the continued growth of its fintech ecosystem, with blockchain, digital assets, distributed ledger technology (DLT) and artificial intelligence playing a central role in shaping its future.

Hong Kong is home to over 1,100 fintech companies. This includes 175 blockchain application or software firms and 111 digital asset and cryptocurrency companies, which marked 250% and 30% increases, respectively, since 2022, according to the Hong Kong Fintech Ecosystem report by InvestHK, a government department overseeing Foreign Direct Investments.

Exploring deeper fintech revenue streams

The expansive growth of Hong Kong’s Web3 industry is attributed to proactive government policies and an active licensing regime for crypto exchanges or virtual asset trading platforms.

“The revenue for the Hong Kong fintech market is projected to reach US$606 billion by 2032, with an anticipated annual growth rate of 28.5% from 2024 to 2032,” the report stated.

InvestHK, along with other Hong Kong authorities, surveyed 130 fintech companies operating in Hong Kong and identified talent shortage as the top concern in the region, cited by 58.8% of respondents, followed by access to capital at 43.9%.

Addressing these hurdles will be critical to sustaining Hong Kong’s momentum to become the top financial hub.

Over 73% of the surveyed fintech companies operate in the AI subsector, far exceeding the 41.5% focused on digital assets and cryptocurrency.

China’s “one country, two systems” policy at play

The InvestHK report highlighted Hong Kong’s advantage in adopting China’s “one country, two systems” policy, allowing it to maintain a free-market economy, unrestricted capital flow and strong global trade relations while benefiting from its proximity to mainland China.

As a result, the Hong Kong government was able to roll out several Web3 innovations, including a licensing regime, spot Bitcoin (BTC) and Ether (ETH) exchange-traded funds, the Hong Kong Monetary Authority’s stablecoin sandbox and tokenized finance and AI integration.

In 2021, the HKMA unveiled a strategy to establish itself as a financial hub by 2025.

The strategy included encouraging fintech adoption among banks, increasing Hong Kong’s readiness in issuing central bank digital currencies at both wholesale and retail levels, enhancing the city’s existing data infrastructure and building new ones, increasing the supply of fintech talent and formulating supportive policies for the Hong Kong fintech ecosystem.

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US Rep. Byron Donalds to introduce bill codifying Trump’s Bitcoin reserve

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5 hours ago

March 14, 2025

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US Rep. Byron Donalds to introduce bill codifying Trump’s Bitcoin reserve

A new bill set to be introduced in Congress aims to formalize President Donald Trump’s executive order establishing a US Strategic Bitcoin Reserve, a move that could further integrate Bitcoin into the nation’s financial strategy.

Trump signed an executive order on March 7 to use Bitcoin (BTC) seized in government criminal cases to establish a national reserve.

The legislation, introduced by US Representative Byron Donalds, seeks to ensure the Bitcoin reserve becomes a permanent fixture, preventing future administrations from dismantling it through executive action.

“For years, the Democrats waged war on crypto,” Donalds, a Florida Republican, said in a statement to Bloomberg. “Now is the time for Congressional Republicans to decisively end this war.”

If the bill is passed, it would ensure that the Strategic Bitcoin Reserve and the US Digital Asset Stockpile could not be eliminated via executive actions by a future administration.

The bill will require at least 60 votes in the Senate and a House majority to pass. With Republicans holding a Senate majority — and amid a generally more crypto-friendly environment — the bill has a chance of passing.

According to Bitcoinlaws data, at least 23 US states have introduced legislation supporting a Bitcoin reserve, reflecting growing state-level interest in integrating crypto into fiscal policy.

A “pivotal moment” for US crypto regulations

The introduction of the Bitcoin reserve-related bill marks a pivotal moment for the wider crypto industry, not just BTC.

The legislation “aims to cement the reserve as a permanent fixture, shielding it from reversal by future administrations,” according to Anndy Lian, author and intergovernmental blockchain expert.

The bill signals the US government’s intent to integrate Bitcoin into its financial framework, Lian told Cointelegraph, adding:

“It builds on Trump’s earlier executive action by providing a statutory backbone, potentially clarifying the government’s stance on digital assets. If passed, the bill could reduce uncertainty that has long plagued the crypto space, where agencies like the SEC and CFTC have often clashed over jurisdiction.”

“A codified reserve might encourage a more cohesive regulatory approach, offering businesses and investors a clearer path forward,” he added.

However, identifying the right funding mechanisms and custody solutions for the Bitcoin reserve is a challenging step for governmental entities that may delay the fund’s creation.

The bill may also provide more clarity on the government’s future Bitcoin acquisition strategies. Although the current plan does not involve government Bitcoin purchases, the order does not rule them out.

The order authorizes the US Treasury and Commerce secretaries to develop “budget-neutral strategies” to buy more Bitcoin for the reserve, provided there are no additional costs to taxpayers.