Crypto Plan Creates Potential Conflicts for Trump
Digital-currency efforts bring campaign closer to industry that is spending to limit regulations
Republican presidential candidate Donald Trump has been stepping up his efforts to court the money and votes of the crypto industry. His latest attempt: a digital-currency project called World Liberty Financial.
While details about the project are scant, the team behind it said this week that it will focus on “spreading U.S.-pegged stablecoins around the world” and ensuring the dominance of the U.S. dollar.
Stablecoins are a type of cryptocurrency that aims to maintain a 1:1 exchange ratio with government-issued currencies such as the U.S. dollar. The most popular stablecoin is tether, which traders have widely used to stash their cash, invest in other tokens and swap for traditional currencies. It has also been heavily used for illicit activities, including terrorism financing and drug trafficking.
Trump and his children’s potential involvement in a digital currency would create a new swath of conflicts of interest for the former president if he is re-elected in November. It would raise concerns over whether Trump might be inclined to push crypto-friendly regulations that benefit his own business—or whether businesses seeking to influence Washington would be inclined to buy Trump’s financial products.
Running a digital currency pegged to the dollar would create even knottier problems. While the president doesn’t control the value of the dollar, actions such as running budget deficits could affect its value.
During Trump’s first presidency, his business interests caused repeated concerns among government ethics experts. Foreign dignitaries, lobbyists and political groups that have interests in Washington opted to stay at Trump hotels or otherwise spend money at Trump businesses. That created the possibility they were trying to purchase influence with the president.
Presidents are excluded from federal conflict-of-interest rules, and critics during Trump’s first presidency found few lines of recourse when it came to the millions of dollars spent at Trump’s hotels during that time.
It isn’t the first time the former president has promoted products while on the campaign trail: Trump has also sold $399 gold sneakers and $59.99 bibles during his 2024 presidential campaign. Trump also launched crypto’s version of trading cards, called nonfungible tokens.
Trump and his two elder sons have been teasing about the so-called DeFi project on social media for weeks. DeFi stands for decentralized finance, an umbrella term that refers to financial services such as borrowing, lending and trading automated by software and without a human intermediary.
DeFi users borrow and lend to each other without a middleman such as a bank, with terms written directly into the software code. Crypto enthusiasts have long touted it as a way to democratize finance and improve financial inclusion.
“For too long, the average American has been squeezed by the big banks and financial elites. It’s time we take a stand—together,” Trump said in a recent post on his social-media platform Truth Social. The post included a link to the Telegram channel for the project.
The cryptocurrency sector is hoping to make headway in Washington if Trump is re-elected. Cryptocurrency interests have poured nearly $170 million into PACs that have been giving generously to pro-crypto candidates, making cryptocurrency one of the biggest industries spending on the 2024 election cycle.
The promotion of Trump’s crypto effort has attracted scammers who have tried to trick Trump followers by creating fake ads that offer tokens claiming to be associated with the project. Hackers targeted the X accounts of Trump’s daughter and daughter-in-law late Tuesday to promote a fake token claiming to be associated with the official project. The posts were deleted soon after.
The Trump family’s foray into DeFi adds to the crypto agenda he laid out at the annual Bitcoin Conference in July. The former president made a series of promises to the crypto industry, including the creation of a “strategic national bitcoin stockpile” and the establishment of a bitcoin and crypto presidential advisory council. In his Thursday speech at the Economic Club of New York, Trump reaffirmed his desire to make America the “world capital for crypto and bitcoin.”
Trump hasn’t always liked crypto, calling it a “scam against the dollar” just a few years ago. His position shifted by 2022, when he saw an opportunity to make money off NFTs.