Trump Faces Ethics Inquiry Over Crypto Ventures

• Donald Trump faces an ethics investigation after his public involvement in the TRUMP token raised concerns about national security and conflict of interest. 
• In a letter written to the House Oversight and Government Reform, Trump’s meme coin was cited to have the potential to give undue access to foreign entities. 

US House Representative Gerald Connolly has called for an urgent ethics investigation into US President Donald Trump’s recent involvement in the crypto industry. According to him, his actions raise concerns of potential conflict of interest and transparency issues.

Trump’s Involvement in Crypto

As featured in our recent coverage, Donald Trump earlier endorsed the TRUMP token as his official meme coin, sparking speculations and significantly pushing the price to an all-time high price of $75. According to market data, the coin surged by almost 1000% to surpass Shiba Inu (SHIB), becoming the second-largest meme coin in the world. However, this was short-lived, as the asset lost more than half of its accumulated gains in just a day. At press time, TRUMP was trading at $36 after declining by 14% in the last 24 hours.

Trump is also reported to be involved in a Decentralized Finance (DeFi) platform called World Liberty Financial. Fascinatingly, Connolly highlighted in the document submitted to the House Oversight and Government Reform Committee that these actions could compromise national security and allow foreign companies to gain undue access.

Shedding more light on this, Congresswoman Maxine Waters also pointed out that the TRUMP token is “the worst of crypto.” According to her, this token could encourage anonymous transactions. This implies that sanctioned individuals and global entities could trade in it for profit without any serious oversight.

Expert Links Trump’s Move to 2021 Fan Token Craze

In the letter, Connolly also pointed out that WLF provides no tangible financial return. However, it only enables foreign entities to “curry favour with Trump and his organization.”

WLF is yet to be officially launched into the market. However, the company backing this token has been actively amassing some of the crypto assets to kick-start its operation. As outlined in our recent blog post, World Liberty Financial has made a massive move to purchase 14,403 ETH ($48 million). We also reported in a recent update that $7.38 million has been invested in Tron (TRX).

Meanwhile, the head of the watchdog group Project On Government Oversight, Danielle Brian, believes that these moves are concerning, especially with the loose oversight of the industry.

Besides being a blatant financial conflict of interest on behalf of the president … it is deepening his engagement in a world that raises real national security concerns.

Commenting on the ongoing development, University of Sussex finance professor Carol Alexander has also highlighted that the Trump and Melania tokens operate similarly to the fan tokens that hit the crypto space in 2021. Meanwhile, senior director at crypto market-maker Wincent Paul Howard believes that Trump’s crypto move was a step to bringing legitimacy to the space.

The fact that a president is doing this brings some sort of legitimacy to the space, and I think just means that the industry is moving ahead in a way it hasn’t for the last 10 years.