Sir Keir Starmer defends China policy after spy scandal
Sir Keir Starmer said he is “concerned” about the challenge China poses in his first comments on an alleged spy with links to Prince Andrew who has been barred from the UK.
Speaking from a press conference in Norway, the prime minister said he could not comment on whether the government has discussed the situation with Buckingham Palace.
He said that there is “a long-standing convention” in the UK that talks between Downing Street and the royal family are “never spoken about”.
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However he said that “of course we are concerned about the challenge China poses”, as he defended his push for a “pragmatic” relationship with Beijing.
Sir Keir said: “Our approach.. is one of engagement, of co-operating where we need to co-operate on issues like climate change, to challenge where we must and where we should particularly on issues like human rights, and to compete when it comes to trade.”
The alleged spy, known only as H6, was described in court as having formed an “unusual degree of trust” with the Duke of York. Last week a judge upheld a ruling that he should be banned from the UK.
Sky News has seen photos of him with David Cameron and Theresa May when they were Conservative prime ministers, but a court order prevents him from being named.
Identifying the agent is a “matter for the courts”, government minster Jim McMahon said earlier on Monday, amid threats from Reform UK to name the man in the House of Commons using parliamentary privilege.
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‘Everybody within cabinet’ likely knows
This allows members of parliament to speak freely during parliamentary proceedings without fear of legal action.
Mr McMahon, a minister for local government, said that the mechanism should be exercised with caution, telling Sky News: “Whether people choose to use parliamentary privilege is a matter of individual reconciliation.
“In the end, they need to be able to justify why they’ve done that.”
He said that while he does not know the alleged agent’s identity, he assumes “that everybody within the cabinet, depending on their security clearance, will know the answer to that question”.
“In terms of the identity of the person…that is a matter for the courts. They will make a judgement on whether the identity should be released or not,” he said.
H6 ‘tip of the iceberg’
MPs want more information on the individual, with former Tory leader Sir Iain Duncan Smith seeking to ask an Urgent Question in parliament on Monday about the United Front Work Department – the group said to be associated with H6.
The earliest this could take place today, if granted by Speaker of the House of Commons Sir Lindsay Hoyle, would be at 3.30pm.
Sir Iain has warned there are “many, many more” like H6 in the UK.
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‘Tip of the iceberg with Prince Andrew’
He told BBC Radio 4’s Today programme: “We’re dealing with the tip of the iceberg.
“The reality is that there are many, many more involved in exactly this kind of espionage that’s taking place. The reality for us is very simple – China is a very clear threat.”
Tom Tugendhat, the former Conservative security minister, echoed those warnings, telling Sky News there has been “a pattern” of attempts to influence or change British policy, and also attempts to steal economic secrets and intellectual property.
He criticised Sir Keir for having a summit with China’s premier Xi Jinping, and Chancellor Rachel Reeves for planning meetings in China in the new year – saying closer ties are not appropriate.
He also called for Labour to continue with the foreign influence registration scheme, which was established under the Conservatives but is yet to be implemented.
The scheme would require those involved in promoting the interests of other countries to declare themselves.
Sir Keir told the press conference in Norway he has been “working on it from day one in government” and “there will be an update coming shortly”.
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The alleged agent was first excluded from Britain by then-home secretary Suella Braverman in 2023, when the Home Office said he was believed to have carried out “covert and deceptive activity” for the Chinese Communist Party.
Judges at a specialist tribunal in London on Thursday ruled Ms Braverman had been “entitled to conclude” that he “represented a risk to the national security” after he launched an appeal against the decision.
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H6 was invited to Prince Andrew’s birthday party in 2020, and was told by royal aide Dominic Hampshire he could act on the duke’s behalf when dealing with potential investors in China, a tribunal heard in July this year.
A judge ruled the Chinese businessman had an “unusual” degree of trust from the royal.
On Friday, the duke said he “ceased all contact” with the businessman after concerns were raised by the government.
The Chinese embassy in London has denied H6 is a spy and accused “some people” in the UK of being keen to “make up all kinds of ‘spy’ stories against China…to smear China and sabotage normal people-to-people exchanges between China and the UK”.
Taiwanese lawmaker Ko Ju-Chun has called on the government to consider adding Bitcoin to its national reserves, suggesting it could serve as a hedge against global economic uncertainty.
Ko, a legislator at-large in Taiwan’s legislative body, the Legislative Yuan, took to X on Friday to report that he had advocated Bitcoin (BTC) investment by the Taiwanese government at the National Conference on May 9.
In his remarks, Ko cited Bitcoin’s potential to become a hedge amid global economic risks and urged Taiwan to recognize the cryptocurrency alongside gold and foreign exchange reserves to boost its financial resilience.
Ko’s announcement came shortly after the legislator held talks with Samson Mow, who advocates for Bitcoin adoption by states like El Salvador at his BTC tech firm Jan3.
Taiwan is an export-oriented economy
Ko highlighted that Taiwan is an export-driven economy that has experienced significant fluctuations in its national currency, the New Taiwan dollar, amid global inflation and intensifying geopolitical risks.
“We currently have a gold reserve of 423 metric tons, and our foreign exchange reserves amount to $577 billion, including investments in US Treasury bonds,” the lawmaker stated.
In a scenario of more intense currency volatility or potential regional conflicts, Taiwan may “very likely be unable to ensure the security and liquidity,” Ko continued, adding that Bitcoin could be a great addition to Taiwan’s reserves for several reasons.
“Bitcoin has been operating for over 15 years. It has a fixed total supply, is decentralized, and is resistant to censorship. Many countries are focusing on its hedging attributes. At the same time, in intense situations, it may not face the risk of embargo,” he said.
Bitcoin is not the only solution
Referring to many global initiatives considering Bitcoin adoption as a reserve asset, Ko stressed that he’s not advocating for Bitcoin as the “only solution” to rising economic challenges.
Instead, the legislator suggested adding a “small proportion of Bitcoin” into the diversified assets as tools for sovereign asset allocation and risk hedging, and backup capacity of Taiwan’s financial system.
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He previously suggested that Taiwan could allocate a maximum of 5% of its $50 billion reserve to Bitcoin in an X post on May 6.
“When exchange rate risk and regional uncertainty increase, it is time to introduce new tools to construct a more flexible financial strategy framework,” Ko said, adding:
“As former Dean Chen Chong said, Bitcoin is the gun of the digital era. It may also be the gold of the digital era, the silver of the digital era. Or it could be gunpowder. A wise nation will not let weapons be in others’ hands.”
The news comes as Taiwan is emerging as a crypto-friendly jurisdiction, with the Financial Supervisory Commission pushing institutional trials of crypto custody services in late 2024.
Mainland China continues to maintain its hostile stance on cryptocurrency after imposing a ban on multiple crypto activities, including mining, in 2021.
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German law enforcement seized 34 million euros ($38 million) in cryptocurrency from eXch, a cryptocurrency platform allegedly used to launder funds stolen after Bybit’s record-breaking $1.4 billion hack.
The seizure, announced on May 9 by Germany’s Federal Criminal Police Office (BKA) and Frankfurt’s main prosecutor’s office, involved multiple crypto assets, including Bitcoin (BTC), Ether (ETH), Litecoin (LTC) and Dash (DASH). The move marks the third-largest crypto confiscation in the BKA’s history.
The authorities also seized eXch’s German server infrastructure with over eight terabytes of data and shut down the platform, the announcement added.
eXch exchanged crypto without AML
In the statement, the BKA described eXch as a “swapping” service that allowed users to exchange various crypto assets without implementing Anti-Money Laundering (AML) measures.
The platform had operated since 2014 and reportedly facilitated about $1.9 billion in crypto transfers, some of which were believed to be of “criminal origin,” including assets laundered during the Bybit hack.
“Among other things, a portion of the $1.5 billion stolen from the Bybit crypto exchange, which was hacked on Feb. 21, 2025, is said to have been exchanged via eXch,” the authorities wrote.
Multisig, FixedFloat among laundering cases
According to a post by crypto sleuth ZachXBT, eXch was also involved in laundering millions of funds from other crypto thefts and exploits, including Multisig, FixedFloat and the $243 million Genesis creditor theft.
Those were in addition to “countless phishing drainer services over the past few years with refusal to block addresses and freeze orders,” ZachXBT said.
ZachXBT was among the first security analysts to report on eXch’s links to laundering $35 million of crypto assets stolen from Bybit soon after the hack was confirmed.
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“Lazarus Group transferred 5K ETH from the Bybit Hack to a new address and began laundering funds via eXch (a centralized mixer) and bridging funds to Bitcoin via Chainflip,” ZachXBT wrote in a Telegram post on Feb. 22.
eXch announced termination of services by May 1
After initially denying involvement in laundering funds from the Bybit hack, eXch eventually announced it would cease operations by May 1 in a Bitcoin Talk post published in mid-April.
“Even though we have been able to operate despite some failed attempts to shut down our infrastructure […], we don’t see any point in operating in a hostile environment where we are the target of SIGINT [Signals Intelligence] simply because some people misinterpret our goals,” it wrote.
Addressing the seizure, senior public prosecutor Benjamin Krause stressed the importance of action against “quick and anonymous opportunities for money laundering for any amount.”
“Crypto swapping is an essential component of the underground economy, used to conceal incriminated funds from illegal activities such as hacking or trading in stolen payment card data, thus making them available to perpetrators,” he said.
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