The Trump Family Crypto Business - WSJ editorial
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Mr. Trump said last month that he’ll host a dinner with the top 220 holders of his $TRUMP meme coin at his Washington, D.C.-area golf club on May 22. Step right up and invest in the Trump crypto enterprise for a chance to rub elbows with the leader of the free world. The President says all of this is above board. But it nonetheless raises the appearance of a conflict of interest in selling access to the President.
The Trump Organization and affiliates hold 80% of $TRUMP coin tokens, which are subject to a three-year unlocking period. Any price appreciation caused by frenzied buying boosts the Trump family fortune, at least on paper. The Trump family businesses and their partners have benefited from more than $300 million in revenue generated by trading in the coin, according to the blockchain firm Chainalysis. A percentage of each trade is routed to crypto wallets linked to the coin’s creators, similar to a transaction fee.
When Mr. Trump issued his meme coin days before his inauguration, he said the point was to “have fun.” As we noted at the time, the venture creates political risks and ethical conflicts. Bloomberg News last week reported that all but six of the top 25 holders of the $TRUMP coin that have registered on the website’s leaderboard have bought the coins using foreign exchanges that claim to exclude U.S. customers. This suggests most of the buyers are overseas. Foreigners are prohibited from contributing to U.S. political campaigns, but there’s no bar on them buying stock in a politician’s business. That’s effectively what foreign buyers of Mr. Trump’s tokens are doing. Might some be trying to buy goodwill with the Trump Administration?
Then there’s the Trump family’s other crypto venture, World Liberty Financial, which has raised $550 million through token sales since October. A business entity affiliated with Mr. Trump and his family members owns a major chunk of World Liberty. Its tokens can’t be publicly traded like most crypto-currencies, though coin owners supposedly get a vote on the company’s governance.
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Zach Witkoff, son of Trump diplomatic envoy Steve Witkoff, co-founded World Liberty Financial and helps run its day-to-day operations. Could he make the “dialogue” happen by pinging his dad, another co-founder? The younger Witkoff said this month that Abu Dhabi would use World Liberty Financial’s newly minted stablecoin to invest $2 billion in the crypto exchange Binance.
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