After a noticeable pivot and courtship with the cryptocurrency industry, President Donald Trump is now reportedly profiting immensely from a sector he once deemed a “scam.” His recent engagements, including private dinners rewarding top crypto token purchasers and significant investments in his ventures by industry figures, have ignited fierce criticism. Ethics watchdogs, former prosecutors, and scholars are expressing alarm, citing unprecedented conflicts of interest and open corruption, as Trump’s administration simultaneously moves to loosen crypto regulations.
Courting the Crypto Rich
Cryptocurrency multibillionaire Justin Sun openly showcased a $100,000 Donald Trump-branded watch, awarded at a private dinner at Trump’s Virginia golf club. Sun earned this recognition for purchasing $20 million of the crypto memecoin $Trump, securing his invitation among 220 token purchasers. This May 22 dinner and a subsequent White House tour for 25 leading memecoin buyers generated approximately $148 million for Trump and his partners, much of it from anonymous and foreign buyers.
Ethical Storm Over Presidential Influence
Trump’s private events to reward top $Trump token purchasers have drawn strong criticism from ethics watchdogs, former prosecutors, and scholars. They accuse the president of exploiting his office for personal gain in unprecedented ways, fitting a broader pattern of leveraging his power and allure for cryptocurrency enrichment. Steven Levitsky of Harvard University remarked, “I have never seen such open corruption in any modern government anywhere.”
Deepening Ties: World Liberty Financial
The ethical and legal concerns have not deterred Trump or Justin Sun from deepening their ties. Sun had previously invested $75 million in World Liberty Financial (WLF), another Trump crypto enterprise launched last fall, in which Trump and his two older sons boast a 60% stake. This investment underscores the significant financial relationships forged between the former president and key figures in the crypto industry.
Deregulation Under Trump
Since Trump’s return to office, there has been a noticeable shift towards loosening regulations on cryptocurrency ventures across various agencies, including the Securities and Exchange Commission (SEC) and the Justice Department. This change of pace has benefited crypto tycoons and political donors alike. For instance, three crypto companies associated with Justin Sun, previously charged with fraud by the SEC in 2023, saw their cases paused by the agency in February, citing “public interest.”
Mounting Wealth and Policy Shift
Trump’s crypto ventures, though less than a year old, are estimated by the State Democracy Defenders Fund to be worth approximately $2.9 billion as of mid-March. This substantial increase in his “paper wealth” coincides with his vigorous efforts to cut regulations, fulfilling pledges to make the US the “crypto capital of the planet” and end the “war on crypto.” This represents a significant shift from his 2019 and 2021 statements, where he expressed skepticism about Bitcoin and concerns about unregulated crypto.
Broader Risks and Scandals
Critics worry that Trump’s push for less regulation may exacerbate existing problems in the crypto industry, which has been plagued by major scandals and concerns about transparency. For example, North Korean hackers stole a record $1.34 billion in cryptocurrency in 2024, with funds allegedly diverted to finance weapons programs. Additionally, the FBI reported that fraud related to crypto businesses surged in 2023, with Americans losing $5.6 billion, a 45% increase from the prior year.
Controversial Binance Dealings
Some high-profile crypto deals involving WLF have sparked further concerns, particularly due to their connections with overseas crypto firms that have faced regulatory and legal issues in the US. A lucrative deal involved WLF playing a central role in a $2 billion investment by Abu Dhabi financial fund MGX into Binance, the world’s largest crypto exchange. This occurred despite Binance having pleaded guilty in 2023 to violating US money-laundering laws and its former CEO, Changpeng Zhao, serving a four-month jail term.
Lawmakers Raise Alarm
The ethical implications of Trump’s crypto dealings have prompted sharp criticism from lawmakers. Democratic Senators Richard Blumenthal, Jamie Raskin, Jeff Merkley, and Elizabeth Warren have launched inquiries and introduced legislation aimed at curbing such perceived corruption. Former Republican congressman Charlie Dent also expressed concern, stating, “Nobody should be allowed to use their public positions while in office to enrich themselves.”
