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Donald Trump Jr had a wonderful answer this week for journalists asking whether there might be — just might be — any ethically blurred lines between his family’s crypto venture, World Liberty Financial, and foreign governments or other actors hoping to get special treatment from the US president.
“I don’t think anyone actually believes that my father or [Zach Witkoff’s] father would be looking at ledgers on the blockchain to see who bought what, and that carrying any kind of favour,” he told CNBC at the Token2049 crypto conference in Singapore, referring to the 47th US president and to Steve Witkoff, father of the firm’s CEO and Trump’s special envoy to the Middle East. The idea that there might be any conflicts of interest was “complete nonsense”.
Per the president’s eldest son, then, the notion that Donald Trump would actually bother looking at who might be pouring vast sums of money into his family-backed firm — all three of his sons are co-founders of World Liberty Financial, he is “co-founder emeritus” and the family hold multiple billions of dollars’ worth of its crypto token, WLFI — is preposterous. Of course, you might argue that anyone wanting a favour from Trump could just tell him they were investing money in one of his crypto projects so as to avoid him having to “look at ledgers on the blockchain”, but that would simply be malicious speculation.
Furthermore, while billions of dollars of Trump’s net worth might now derive from the bounteous blockchain gravy train, the president has already confessed that he doesn’t know much about crypto. Surely “but I don’t understand the technology, officer” is as good an excuse as any. So move along please. Nothing to see here.
But allow me to set out a little context, because there have been some intriguing developments that at least raise questions as to Trump’s awareness of “who bought what”. Last month, it emerged that the United Arab Emirates had chosen to use $2bn worth of World Liberty Financial’s stablecoin for its investment into the crypto exchange Binance, just two weeks before the US gave the Gulf state access to hundreds of thousands of the world’s most advanced and scarce AI chips. Both the White House and World Liberty Financial deny any connection between the two deals.
There was also the time when the US Securities and Exchange Commission put a fraud investigation into Justin Sun’s companies on hold, with the SEC and Sun filing a joint motion seeking a pause to explore a possible resolution. This came after Trump indicated he wanted lighter-touch crypto regulation. It also appears the crypto billionaire has bought more than $90mn worth of two Trump-issued crypto tokens.
Or the time when Trump hosted a dinner for top buyers of his $TRUMP memecoin, which he had used his Truth Social platform to shill: “I LOVE $TRUMP — SO COOL!!! The Greatest of them all!!!!!!!!!!!!!!!! [sic]”. The president made at least $350mn from the coin’s launch, which has plunged by more than four-fifths in value since.
How can we account for all this? And is it just a coincidence — or simply because his sons happen to be so passionate about it — that all of it happens to involve crypto?
One of the technology’s major advantages is that very few people understand how it actually works (including, as we have seen, some of those making vast sums of money from it). In a Gallup poll in July, while a large majority of Americans said they had heard of crypto, only 35 per cent claimed to “know something about” it. It is much easier to pull the wool over someone’s eyes when the eyes in question have utterly glazed over after a crypto bro has spent 10 minutes extolling the wonders of the distributed dream-ledger.
Crypto itself is the Wild West of finance, where exploiting regulatory loopholes and bypassing national controls is the name of the game. The bros will protest that the blockchain is a transparent shared database where the transactions are there to see in plain sight. But while that may be partially true, what they will fail to tell you is that the parties involved are visible only as strings of numbers and letters, and that those in the know use crypto “mixers” and privacy coins to scramble them around to the point that transactions are essentially untraceable.
Crypto has never been about innovation, but about getting away with things you would not otherwise be able to. And it’s not just the US: while Ireland has banned political crypto donations, Nigel Farage’s Reform party just became the first major UK party to accept them, opening the door to all sorts of actors exerting political influence. Crypto was built for this. Murky dealings aren’t the bug, they’re the whole point.
jemima.kelly@ft.com
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