As he falls out with Farage, how should politicians handle Elon Musk?

Published

5 months ago

January 5, 2025

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For British politicians, the question of the moment is how do you handle Elon Musk?

The billionaire owner of X and Tesla, soon to take up a role as efficiency tsar in the Trump administration, has been throwing grenades almost every hour about British politics on his social media platform and dominating the headlines.

Much of it is inflammatory claims about Keir Starmer and his government – despite their efforts to build good relations with Donald Trump.

And until today, enthusiastic backing for Nigel Farage, who only in mid-December met Musk in the glitzy surroundings of Mar-a-Lago to talk money, amid reports he was considering a $100m donation to Reform.

Then bam! – after Farage repeatedly hailed Musk as a “hero” who made Reform “look cool” and was looking forward to a chat at Trump’s inauguration – the tables have turned rather dramatically.

Musk tweeted that Farage “doesn’t have what it takes” to lead the party and that Reform needs a new leader.

His change of heart comes after Musk has spent days intensively tweeting about grooming gangs in the UK, and his support for jailed far right activist Tommy Robinson, who has seized on this issue.

Farage, who has tried to distance himself from Robinson for most of his career, thinks this is the reason for the fall out, responding that he was surprised but added: “My view remains that Tommy Robinson is not right for Reform and I never sell out my principles.”

Last week, Musk posted a series of tweets calling for Robinson – real name Stephen Yaxley-Lennon – to be released from prison, where he is serving an 18-month sentence for contempt of court for repeating false allegations against a Syrian refugee.

What does this spat mean for Reform?

In the short-term, Reform would hardly have wanted an unexpected falling out just as they are trumpeting rising membership figures and Farage is poised to meet him in Washington.

But Farage sees Robinson as toxic for his brand, and a distraction from his mission of building a campaign machine to fight the next UK general election – even if he loses powerful friends.

The prospect of a donation from Musk – who has donated huge sums to Donald Trump’s campaign, would have been an enticing one, but there were already significant legal questions around it, under UK election rules.

Farage’s friendship with Trump, going back to his first term as president, also does not seem to have been affected, so a hotline to the White House is still possible.

What does it mean for Starmer and Labour?

It’s unclear what Trump thinks about Musk’s recent obsession with British politics altogether – as he rails against Keir Starmer and other US allies hour by hour, and whether this online trolling will be tolerated after he takes up his job in the White House.

This is a question that Labour officials are eagerly awaiting the answer to, although there may be some relief that the criticism is now being turned on Farage.

Musk has – in the last day or two alone – made a series of incendiary and unfounded accusations against Starmer, claiming he was “complicit in the rape of Britain”, that he is “guilty of terrible crimes” and questioning whether he, as director of public prosecutions, “allowed rape gangs to exploit young girls without facing justice?”

Wes Streeting, the health secretary, doing interviews today, said Musk’s criticism was “completely ill-judged and ill-founded” and that Starmer had done a huge amount to support victims and achieve prosecutions in grooming cases. But largely, the government are trying to ignore the noise.

Kemi Badenoch was accused of dancing to Musk’s tune by calling for a national inquiry into grooming gangs – the Conservatives having rejected one when in government just two years ago.

An unelected US-based billionaire is now setting a cat among the pigeons for all parties in Britain – and throwing issues into the limelight which none will find easy to ignore.

Politics

Russian national arrested in South Korea for attempted crypto robbery

Published

4 hours ago

May 27, 2025

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Russian national arrested in South Korea for attempted crypto robbery

South Korean authorities have arrested one of three Russian nationals accused of an attempted robbery during a fake crypto deal in Seoul. The suspects allegedly lured Korean investors to a hotel, where they tried to steal 1 billion won (approximately $730,000) in cash.

The Gangseo Police Precinct in Seoul detained a man in his 20s in Busan on May 27, according to a report by local news outlet JoongAng Daily. The suspect faces charges of assault and attempted robbery. The other two suspects reportedly fled South Korea shortly after the incident.

According to investigators, the robbery attempt occurred on May 21 at a hotel in Seoul’s Gangseo District. The suspects posed as participants in a peer-to-peer crypto transaction and invited 10 Korean men to the hotel.

Two were called to the room while the others waited in the lobby. Inside the room, the suspects — wearing protective vests — ambushed the victims with a replica handgun and a telescopic baton, tying their hands with cable ties.

Police seize weapons, launch global manhunt

Per the report, one of the victims managed to escape and raise the alarm, prompting the suspects to flee without the cash. Police responded to an emergency call and found one man bleeding in the lobby.

Officers discovered a cache of equipment in the suspects’ hotel room, including a replica firearm, batons, vests and a money counter. Police suspect the robbery had been carefully planned.

A request to prevent the suspects from leaving the country was filed the next morning, but two had already departed. “We have requested assistance from Interpol to track down the suspects who fled overseas,” a police official reportedly said.

Authorities are now questioning the detained suspect and preparing to seek a pretrial detention warrant.

Rise in crypto crime incidents

The incident comes amid a recent uptick in crypto-related violent crimes, including kidnapping and ransom cases.

A Manhattan crypto investor faces serious charges after allegedly kidnapping and torturing an Italian man in a bid to extract access to digital assets.

On May 13, the family of Pierre Noizat, the co-founder and CEO of French crypto exchange Paymium, was targeted in an attempted kidnapping.

In response, executives and investors in the crypto industry are increasingly seeking personal security services. On May 18, private firm Infinite Risks International reported a rise in requests for bodyguards and protection contracts from high-profile figures in the crypto space.

Magazine: TradFi is building Ethereum L2s to tokenize trillions in RWAs: Inside story

Politics

IMF upgrades UK economic growth forecast – but issues tariffs warning

Published

6 hours ago

May 27, 2025

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IMF upgrades UK economic growth forecast - but issues tariffs warning

The UK economy will grow more than previously thought, according to the International Monetary Fund (IMF), which has upgraded its latest forecast.

But it warned trade tensions linked to US tariff plans will reduce UK economic growth next year.

The Washington-based UN financial agency said the UK economy will expand 1.2% this year and “gain momentum next year”.

The upgrade in forecasts, however, is slight, up from an expected 1.1% announced in April as the world reeled from the global trade war sparked by US President Donald Trump’s tariffs.

That April figure was a 0.5% downgrade from the projected 1.6% growth for 2025 the IMF foresaw in January and the 1.5% forecast issued in October.

It means the IMF expects the UK economy to grow less this year than it forecast in October and January.

Money blog: Britons face 100% property tax in Spain

Tariffs warnings

This anticipated lower growth is largely due to tariffs – taxes on goods imported to the United States – and the uncertainty caused by shifting trade policy in the US, the world’s largest economy.

While many tariffs have been paused until 8 July, it’s unclear if deals will be in place by then and if pauses may be extended.

The effect of this has been quantified as a 0.3 percentage points lower growth by 2026 in the UK, the IMF said.

The organisation held its prediction that the UK economy will grow by 1.4% in 2026.

“The forecast assumes that global trade tensions lower the level of UK GDP by 0.3% by 2026, due to persistent uncertainty, slower activity in UK trading partners, and the direct impact of remaining US tariffs on the UK,” it said.

It comes despite the UK having agreed a deal with the Trump administration to circumvent the 25% tariffs on cars and metals.

The IMF also cautioned that “weak productivity continues to weigh on medium-term growth prospects”.

Welcome news

Interest rates “should” continue to come down, making borrowing cheaper, though the IMF acknowledged the rate-setters at the Bank of England now have a “more complex” job due to the recent rise in inflation and “fragile” growth.

The author of the report on the UK Luc Eyraud said the IMF expected the Bank to cut interest rates by 0.25 percentage points every three months until they reach a level of around 3%, down from the current 4.25%.

Praise was given to the UK government as the IMF said “fiscal plans strike a good balance between supporting growth and safeguarding fiscal sustainability”.

The news is being taken as a win by Chancellor Rachel Reeves.

“The UK was the fastest growing economy in the G7 for the first three months of this year and today the IMF has upgraded our growth forecast,” she said.

“We’re getting results for working people through our plan for change – with three new trade deals protecting jobs, boosting investment and cutting prices, a pay rise for three million workers through the national living wage, and wages beating inflation by £1,000 over the past year.”

Politics

Luxembourg flags crypto companies as high risk for money laundering

Published

7 hours ago

May 27, 2025

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Luxembourg flags crypto companies as high risk for money laundering

Luxembourg classified virtual asset service providers (VASPs) as high-risk entities for money laundering in its 2025 National Risk Assessment (NRA), highlighting concerns over the crypto industry’s exposure to financial crime.

According to the report, the inherent risk level of VASPs is deemed “High,” driven by factors including transaction volume, client reach, distribution channels, legal structures and the international scope of operations.

The NRA identified VASPs as an emerging risk in its 2020 report after “a detailed assessment of ML inherent risks emerging from virtual assets.” This was followed by a 2022 NRA report deeming “the risks associated with crypto assets and virtual currencies as very high,” because, among other things, they are internet-based and cross-border.

EU’s evolving crypto regulation

The European Union, of which Luxembourg is a founding member, has been working to regulate the cryptocurrency industry. A key part of this effort is the Markets in Crypto-Assets (MiCA) framework, which is designed to unify crypto regulation across all 27 EU member states.

Since January, crypto asset service providers have started acquiring licenses to operate legally within the EU. In May, cryptocurrency exchange Kraken launched regulated derivatives trading, and competitor Crypto.com secured a license allowing it to do the same.

MiCA also establishes a new set of requirements for stablecoins. The stablecoin market leader behind USDt (USDT), Tether, refuses to comply with the new rules and was delisted on Crypto.com, Coinbase and leading crypto exchange Binance on their EU platforms.

Money laundering with crypto

As the role of cryptocurrencies in the broader financial ecosystem increases, so does their popularity for money laundering. Earlier this month, Hong Kong police arrested 12 people involved in a cross-border money laundering scheme that relied on crypto and over 500 stooge bank accounts to launder 118 million Hong Kong dollars ($15 million).

Luxembourg — *Crypto value received by illicit addresses per year. Source:* *Chainalysis*

According to reports this month, European law enforcement arrested 17 suspects of a “mafia crypto bank” for allegedly laundering over 21 million euros ($23.5 million) in crypto for Middle East and China-based criminal entities. As a result of the proceedings, 4.5 million euros ($5 million) worth of items were seized, including cash, crypto, 18 vehicles, four shotguns and several electronic devices.

Magazine: Chinese Tether laundromat, Bhutan enjoys recent Bitcoin boost: Asia Express