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Britain may need anti-subversion laws to counter threats from states determined to undermine democracy, a government watchdog has said.

Jonathan Hall KC, the independent reviewer of state threat legislation, is due to report this week on using counter-terrorism laws against state interference.

Mr Hall was asked by Home Secretary Yvette Cooper to review whether there were elements of counter-terrorism legislation which could be emulated to address state-based security threats last December.

In particular, he was asked to look at what legal measures would be useful against “highly aggressive state bodies” such as Iran’s Islamic Revolutionary Guard Corps (IRGC).

In a speech to the Policy Exchange thinktank on Monday, Mr Hall will say the internet offers intelligence officers a “perfect way of directly recruiting tasking and paying individuals”.

“Young people who might once have been attracted to a terrorist cause are now willing to carry out sabotage for [Russian President Vladimir] Putin’s Russia,” he will add in the John Creaney Memorial Lecture.

“They are recruited in exactly the same way, by groups operating on Telegram”, an encrypted messaging app, the reviewer says.

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Telegram app logo. File pic: Reuters
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Telegram app logo. File pic: Reuters


“I am thinking about the measures that may one day be needed to save democracy from itself. What do I mean? I am referring to counter-subversion,” he is set to add.

Counter-subversion was part of MI5’s role in the 1950s and 1970s but fell out of favour, associated with McCarthyism and infiltrations of domestic protest groups by undercover police, Mr Hall says.

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New laws may now be needed but they would need to come with legal safeguards.

“If I was a foreign intelligence officer, of course I would ensure that the UK hated itself and its history,” he says in the speech.

“That the very definition of woman should be put into question, and that masculinity would be presented as toxic.

“That white people should be ashamed and non-white people aggrieved. I would promote antisemitism within politics.

“My intention would be to cause both immediate and long-term damage to the national security of the UK by exploiting the freedom and openness of the UK by providing funds, exploiting social media, and entryism.”

Pro-Russia groups find ideological affinity with “lone actors” by posing as “protectors of Christian civilisation” and position Russia as a “true defender of crumbling Western civilisation,” he says.

Foreign intelligence agents could already be using social media as a “delightful playground for wedge issues”.

They could seek to use online “sextortion” tactics to obtain kompromat and force individuals to carry out tasking, while they may also be seeking to meddle in Brexit, Scottish independence or the independence of overseas territories.

They could also sponsor contentious foreign policy issues such as Gaza, or amplify the lie that the Southport killer was a Muslim who arrived on a small boat, Mr Hall says.

Mourners react during the funeral of Palestinians killed in Israeli strikes, at Al Shifa hospital, in Gaza City, May 18, 2025. REUTERS/Mahmoud Issa
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Foreign intelligence agents could also sponsor contentious foreign policy issues such as Gaza. File Pic: Reuters

They might encourage extreme forms of environmentalism, or policies that would damage adversaries’ economy “or at least sow discord or hopelessness”, the reviewer adds.

Content moderation – removing, blocking, or limiting access to certain content – is “never going to sufficiently address the unprecedented access that the internet accords to impressionable minds,” Mr Hall says.

Legal measures that have proved useful in dealing with domestic terrorist groups may need to be adapted for groups involved in state threats to stop them promoting themselves and inviting support online and offline, he says in the speech.

One answer is the offence of “foreign interference” under the new National Security Act 2023 but proving that a “foreign hand” is at work can be very difficult, Mr Hall says.

Another answer is “social resilience against disinformation” or even “a Cold War mentality that sniffs out subversion”.

“But what if it was necessary to go further? What if it was necessary to investigate, intrusively, the source of funding for protest movements?”

Mr Hall asks if it might be necessary to “bring forward a law, in the interests of national security, banning extremism or subversion”.

He asks if it might be desirable to pass a law banning Muslim Brotherhood candidates from standing in elections.

The Muslim Brotherhood is an Islamist social movement which arose in Egypt in the 1920s but also gave rise to Hamas.

Such laws would be difficult, he acknowledges, because they would have to be based on general principles that apply to individuals equally – such as separatism, hateful extremism, or subversiveness – which have so far eluded politicians.

If such new laws were introduced, they would “need sufficient safeguard in the form of judicial intervention, not cowed by excessive deference to the executive but ready to correct things when they go wrong”, Mr Hall concludes.

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Prediction markets bet on Coinbase-linked Hassett as top Fed pick

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Prediction markets bet on Coinbase-linked Hassett as top Fed pick

Prediction markets Polymarket and Kalshi view Kevin Hassett, US President Donald Trump’s National Economic Council director, as the favorite to replace Jerome Powell as the next Federal Reserve chair.

The odds of Hassett filling the seat have spiked to 66% on Polymarket and 74% on Kalshi at the time of writing. Hassett is widely viewed as crypto‑friendly thanks to his past role on Coinbase’s advisory council, a disclosed seven‑figure stake in the exchange and his leadership of the White House digital asset working group.​

Founder and CEO of Wyoming-based Custodia Bank, and a prominent advocate for crypto-friendly regulations, Caitlin Long, commented on X:

“If this comes true & Hassett does become Fed chairman, anti-#crypto people at the Fed who still hold positions of power will finally be out (well, most of them anyway). BIG changes will be coming to the Fed.”

Source: Polymarket Money

Related: Crypto-friendly Trump adviser Hassett top pick for Fed chair: Report

Kevin Hassett’s crypto credentials

Hassett is a long-time Republican policy economist who returned to Washington as Trump’s top economic adviser and has now emerged as the market-implied frontrunner to lead the Fed.

His financial disclosure reveals at least a seven‑figure Coinbase stake and compensation for serving on the exchange’s Academic and Regulatory Advisory Council, placing him unusually close to the crypto industry for a potential Fed chair.​

Still, crypto has been burned before by reading too much into “crypto‑literate” resumes. Gary Gensler arrived at the Securities and Exchange Commission with MIT blockchain courses under his belt, but went on to preside over a wave of high‑profile enforcement actions, some of which critics branded as “Operation Chokepoint 2.0.”

A Hassett-led Fed might be more open to experimentation and less reflexively hostile to bank‑crypto activity. Still, the institution’s mandate on financial stability means markets should not assume a one‑way bet on deregulation.​

Related: Caitlin Long’s crypto bank loses appeal over Fed master account

Supervision pushback inside the Fed

The Hassett odds have jumped just as the Fed’s own approach to bank supervision has received pushback from veterans like Fed Governor Michael Barr, who earned his reputation as one of Operation Chokepoint 2.0’s key architects.

According to Caitlin Long, while he Barr “was Vice Chairman of Supervision & Regulation he did Warren’s bidding,” and he “has made it clear he will oppose changes made by Trump & his appointees.”

On Nov. 18, the Fed released new Supervisory Operating Principles that shift examiners toward a “risk‑first” framework, directing staff to focus on material safety‑and‑soundness risks rather than procedural or documentation issues.

In a speech the same day, Barr warned that narrowing oversight, weakening ratings frameworks and making it harder to issue enforcement actions or matters requiring attention could leave supervisors slower to act on emerging risks, arguing that gutting those tools may repeat pre‑crisis mistakes.​

Days later, in Consumer Affairs Letter 25‑1, the Fed clarified that the new Supervisory Operating Principles do not apply to its Consumer Affairs supervision program (an area under Barr’s committee as a governor).

If prediction markets are right and a crypto‑friendly Hassett inherits this landscape, his Fed would not be writing on a blank slate but stepping into an institution already mid‑pivot on how hard (and where) it leans on banks.