Starmer forced to water down Labour reforms as Brighton conference opens amid internal party battle
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.
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Rayner: Starmer’s leadership ‘incredibly strong’
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.
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.”
The agency responsible for conducting criminal prosecutions in England and Wales announced that a National Crime Agency (NCA) officer was due to be charged with the alleged theft of Bitcoin worth roughly $75,000 in 2017.
In a March 14 notice, the Crown Prosecution Service said it had authorized the Merseyside Police to charge NCA officer Paul Chowles with 15 offenses related to the alleged Bitcoin (BTC) theft “during an investigation into online organized crime.” Authorities said Chowles could face one count of theft, 11 charges for concealing, disguising, or converting criminal property and three counts for acquiring, using or possessing criminal property.
The 50 Bitcoin, worth roughly $75,000 before the December 2017 bull run, was valued at more than $4.2 million at the time of publication at a BTC price of $84,541. The NCA officer is expected to appear at the Liverpool Magistrates’ Court on April 25.
Related: British man sues council for $647M over lost Bitcoin in landfill
In April 2024, amendments to the UK’s Economic Crime and Corporate Transparency Act authorized NCA officers and local police to seize crypto from suspected criminals without arresting them. The Crown Prosecution Service did not mention how Chowles allegedly stole the Bitcoin or whether the funds were connected to illicit activities.
Crypto policies across the pond
The NCA said in December 2024 that it had seized roughly $26 million in cash and crypto and arrested 84 people as part of a global campaign to fight money laundering and organized crime. Some of the crypto addresses targeted by UK authorities at the time “showed regular exposure to Garantex.” The founder of the Russian crypto exchange was arrested in India in March and is expected to be extradited to the US to face criminal charges.
The UK government is expected to move forward on creating a comprehensive regulatory framework for digital assets in 2025 following the Labour government’s election victory. The country remains a significant market for crypto users, with Coinbase securing approval to operate from the financial regulatory body in February.
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Politics
US House kills IRS DeFi broker rule, Solana won’t cut 80% inflation rate: Finance Redefined
In a significant regulatory development for the crypto industry, the United States House of Representatives voted to nullify a bill that threatened the privacy-preserving properties of decentralized finance (DeFi) protocols.
In the wider crypto space, one of the Solana network’s most significant governance proposals was rejected; it sought to implement a mechanism to reduce Solana’s inflation rate by about 80%.
US House follows Senate in passing resolution to kill IRS DeFi broker rule
The US House of Representatives voted to nullify a rule requiring decentralized finance (DeFi) protocols to report to the Internal Revenue Service.
On March 11, the House of Representatives voted 292 for and 132 against a motion to repeal the so-called IRS DeFi broker rule that aimed to expand existing IRS reporting requirements to crypto.
All 132 votes to keep the rule were Democrats. However, 76 Democrats joined with the Republicans to repeal it.
This followed the Senate’s March 4 vote on the motion, which saw it pass 70 to 27.
The rule would have forced DeFi platforms, such as decentralized exchanges, to disclose gross proceeds from crypto sales, including information regarding taxpayers involved in the transactions.
After the vote, Republican Representative Mike Carey, who submitted the repeal motion, said, “The DeFi broker rule invades the privacy of tens of millions of Americans, hinders the development of an important new industry in the United States and would overwhelm the IRS.”
Congressman Mike Carey speaking after the vote. Source: Mike Carey
Solana proposal to cut inflation rate by up to 80% fails
A proposal to dramatically change Solana’s inflation system was rejected by stakeholders but is being hailed as a victory for the network’s governance process.
“Even though our proposal was technically defeated by the vote, this was a major victory for the Solana ecosystem and its governance process,” commented Multicoin Capital co-founder Tushar Jain on March 14.
Around 74% of the staked supply voted on proposal SIMD-228 across 910 validators, but just 43.6% voted in favor of it, with 27.4% voting against it and 3.3% abstaining, according to Dune Analytics. It needed 66.67% approval from participating votes to pass and only received 61.4%.
Jain added that this was the biggest crypto governance vote ever, by the number of participants and the participating market cap, of any ecosystem, chain or network.
“This was a meaningful scaling stress test — a social, rather than technical, stress test — and the network passed despite a wide stratification of diverging opinions and interests.”
Bitcoin $70,000 retracement part of “macro correction” in bull market — Analysts
Bitcoin’s potential retracement to $70,000 may be an organic part of the current bull market, despite crypto investor fears of an early arrival of a bear market cycle.
Bitcoin (BTC) fell more than 14% during the past week to close at around $80,708 after investors were disappointed with the lack of direct federal Bitcoin investments in President Donald Trump’s March 7 executive order. It outlined a plan to create a Bitcoin reserve using cryptocurrency forfeited in government criminal cases.
Despite the drop in investor sentiment, cryptocurrencies and global markets remain in a “macro correction” as part of the bull market, according to Aurelie Barthere, principal research analyst at the Nansen crypto intelligence platform.
BTC/USD, 1-month chart. Source: Cointelegraph
Most cryptocurrencies have broken key support levels, making it hard to estimate the next key price levels, the analyst told Cointelegraph, adding:
“This is a macro correction (US tech will be down by 3% in the future, as discussed), so we have to monitor BTC. Next level will be $71,000 – $72,000, top of the pre-election trading range.”
The analyst added: “We are still in a correction within a bull market: Stocks and crypto have realized and are pricing; a period of tariff uncertainty and fiscal cuts, no Fed put. Recession fears are popping up.”
Calls for stricter rules on political memecoins after $4 billion Libra collapse
Industry voices warned that politically endorsed cryptocurrencies must adopt stronger investor protections and liquidity safeguards to prevent another significant market collapse.
Investor sentiment remains shaken after the Libra (LIBRA) token, which was endorsed by Argentine President Javier Milei, suffered a $4 billion market cap wipeout due to insider cash-outs.
According to blockchain analytics firm DWF Labs, at least eight insider wallets withdrew $107 million in liquidity, triggering the massive collapse.
Source: Kobeissi Letter
To avoid a similar meltdown, tokens with presidential endorsements will need more robust safety and economic mechanisms, such as liquidity locking or making the tokens in the liquidity pool non-sellable for a predetermined period, DWF Labs wrote in a report shared with Cointelegraph.
The report stated that tokens from high-profile leaders also need launch restrictions to limit participation from crypto-sniping bots and large holders or whales.
“Limiting bot and whale activity is essential in limiting the impact of individuals acting on insider information to corner a large percentage of the token supply,” according to Andrei Grachev, managing partner at DWF Labs.
Hyperliquid ups margin requirements after $4 million liquidation loss
Hyperliquid, a blockchain network specializing in trading, increased margin requirements for traders after its liquidity pool lost millions of dollars during a massive Ether (ETH) liquidation, the network said.
On March 12, a trader intentionally liquidated a roughly $200 million Ether long position, causing Hyperliquid’s liquidity pool, HLP, to lose $4 million, unwinding the trade.
Starting March 15, Hyperliquid will require traders to maintain a collateral margin of at least 20% on certain open positions to “reduce the systemic impact of large positions with hypothetical market impact upon closing,” Hyperliquid said in a March 13 X post.
The incident highlights the growing pains confronting Hyperliquid, which has emerged as Web3’s most popular platform for leveraged perpetual trading.
Hyperliquid has adjusted margin requirements for traders. Source: Hyperliquid
Hyperliquid said the $4 million loss was not from an exploit but rather a predictable consequence of the mechanics of its trading platform under extreme conditions.
DeFi market overview
According to data from Cointelegraph Markets Pro and TradingView, most of the 100 largest cryptocurrencies by market capitalization ended the week in the red.
Of the top 100, the Hedera (HBAR) token fell over 24%, marking the biggest weekly decrease, followed by JasmyCoin (JASMY) down over 21% over the past week.
Total value locked in DeFi. Source: DefiLlama
Thanks for reading our summary of this week’s most impactful DeFi developments. Join us next Friday for more stories, insights and education regarding this dynamically advancing space.
Thomas John Sfraga, also known as “TJ Stone,” received 45 months in prison for wire fraud and was ordered to pay more than $1.3 million in forfeiture as part of a scheme targeting crypto investors.
In a March 14 notice, the US Justice Department said Sfraga was sentenced in the US District Court for the Eastern District of New York (EDNY) for wire fraud following a May 2024 guilty plea. Court filings stated that the influencer and podcaster claimed he was the owner of businesses — including Vandelay Contracting, a name based on a running joke from the television series Seinfeld — and the emcee of many crypto events in New York City.
“[…] Sfraga convinced a victim to invest in a fictitious cryptocurrency ‘virtual wallet,’” said the Justice Department. “He promised the victims returns on their investments as high as 60% in three months. In reality, however, Sfraga used the money entrusted to him by the victims for his own benefit, to pay expenses, and to pay earlier victims and business associates.”
Sfraga’s case was one of many involving crypto-related crimes continuing to be pursued in the jurisdiction following the appointment of John Durham as interim US Attorney by President Donald Trump. Braden John Karony, former CEO of SafeMoon, who also faces EDNY criminal charges, requested in February that his criminal trial for securities fraud conspiracy, wire fraud conspiracy and money laundering conspiracy be pushed based on the administration’s approach to crypto enforcement.
The “Seinfeldian” scheme, according to Durham, was not the first time the crypto industry was connected to the popular sitcom. Comedian Larry David, co-creator of the show, starred in a Super Bowl ad for defunct cryptocurrency exchange FTX in 2022. He later said he was “an idiot” for endorsing the company and lost a lot of money after the price of specific tokens dropped.
Related: Why comedian TJ Miller wants to be a trustworthy face for Bitcoin
Since Trump took office on Jan. 20, some high-profile defendants in criminal cases involving cryptocurrency have reportedly been looking into appealing to the US president for a pardon. Among those reportedly seeking pardons were former FTX CEO Sam Bankman-Fried, currently serving a 25-year sentence following a 2023 conviction, and former Binance CEO Changpeng Zhao, who served a four-month sentence in 2024 — though he denied reports of a potential pardon.
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