White House Encrypted Revolving Door: Uncovering the Dark Line of the Trump Family's Wealth

Original title:"How Donald Trump's Crypto Dealings Push the Bounds of Corruption"

Author: Kyle Chayka, The New Yorker

Compilation: BitpushNews an

Suppose there is an individual with huge political power who has produced 10 billion lottery tickets and sold them publicly. Participants who purchase these lottery tickets will eventually receive a certain percentage of "magic beans" as rewards, and each "magic bean" can be exchanged for one dollar. More importantly, if you buy the lottery ticket in advance, the price will be less than one dollar, or even as low as five cents per piece. These lottery tickets will not only bring more traditional currency benefits to holders in the future, but also give holders the right to vote on company affairs, allowing them to participate in managing the supply of "magic beans". The more lottery tickets purchased, the greater their voice will be. It should be noted that the initiator of the lottery will retain a batch of lottery tickets for himself, and most of the income generated by the "magic bean" economy will also flow into his hands.

The above description actually reflects the operating mechanism of a new cryptocurrency created by World Liberty Financial, a company associated with the Trump family. The company is "the chief crypto advocate" by President Donald Trump. This cryptocurrency is a so-called governance token called WLFI, which is equivalent to a lottery ticket; while another "stable coin" named USD1 corresponds to "magic beans".

World Free Finance Corporation is involved in the emerging "decentralized finance" field, where cryptocurrency tools enable users to bypass the traditional, regulated banking ecosystem to transfer, store and borrow funds.

Stablecoins are cryptocurrencies pegged to the value of a single currency, such as pegged to a dollar, but not always stable, such as the once successful stablecoin Terra lost its peg and collapsed in 2022. As long as stablecoins are not recognized as securities (such as stocks of publicly traded companies), their legal status is relatively vague.

A statement from World Free Finance stated: "World Free Finance does not consider these tokens to be securities." In January 2023, Trump and his son quietly acquired a controlling stake in World Free Finance through a company called DT Marks Defi. Although the disclosures show that members of the Trump family are not "executives, directors or employees" of the World Free Finance Corporation, DT Marks Defi received 75% of its subsidiaries' net income. (The remaining 25% belongs to the Axiom Management Group, which is associated with two official leaders of World Free Finance, Chase Herro and Zachary Folkman; it is worth noting that Folkman also runs a company called "Date Hotter Girls".)

Trump, a former cryptocurrency skeptic, made it clear in a 2019 tweet: "I don't like Bitcoin." However, in recent years, he has begun to sell various "magic beans" projects, injecting a dose of PR booster into an industry where startups often die at the beginning. In 2022, he launched the Trump Digital Transaction Card, a series of non-fungible tokens (NFTs), and is still rolling out new batches to this day, including a January 2024 "Big Headshot" version with photos of him glaring at the police. (Buyers who bought large quantities of "Big Headshots" NFTs were invited to Mar-Lago.)

Three days before his inauguration, he also launched a so-called meme coin, a cryptocurrency based on network visibility, where early buyers sell it to late buyers at higher prices, which is essentially a pyramid scam. The Trump Meme Coin ($TRUMP) consists of one billion coins, 80% of which are held by Trump-related companies, and the rest is sold to the public. Its sales reportedly earned about $350 million in revenue and had a market value of nearly $3 billion; it is worth noting that Trump's business organizations earn handling fees from every Trump meme currency transaction.

The Trump meme coin price has now fallen below one-fifth of its all-time high, and many buyers have experienced investment depreciation. The subsequent launch of "Melania Trump Meme Coin" performed worse.

However, an event held by Trump's affiliated organization and its crypto project-related company, "Fight Fight", has caused the price of Trump's currency to rebound recently. In this crypto carnival with on-chain holdings as admission tickets, the top 220 holders were qualified to have dinner with Donald Trump - this dinner to be held at Trump National Golf Club in Washington, DC, has essentially built a new political donation channel; and the top 25 "big whale" holders can even enter closed-door receptions. The new lobbying access mechanism built through token holdings will directly convert cryptocurrency holdings into political contact capital, making Trump's currency an alternative power monetization channel outside the traditional political donation system.

Many memecoin investors come from overseas, some of whom are unabashedly expressing their hopes to influence Trump’s policy agenda in this way. An Australian entrepreneur, for example, told the New York Times that he hopes to discuss crypto policies with the president; a Mexican buyer said he hopes to keep Trump focused on tariffs. On Tuesday, a small company operating TikTok e-commerce business in China announced plans to buy $300 million worth of Trump coins and Bitcoin, when the Trump administration is considering whether to push forward a ban on TikTok.

However, the influence of the World Free Finance Corporation is far more than Trump’s meme coins. Its stablecoins can be easily and reliably converted into US dollars, which almost creates an underground economic system sponsored by Trump, like opening a new bank under the name of the current president, and numerous foreign companies and political elites around the world are sending large amounts of money to it. The main buyers who bought a large amount of WLFI include Chinese crypto entrepreneur Justin Sun, who bought $75 million worth of WLFI; and Abu Dhabi-based cryptocurrency trading company DWF Labs, which bought $25 million worth of WLFI.

In March this year, World Liberty Finance announced that it had sold more than $500 million in tokens. Earlier this month, another Abu Dhabi-based investment company announced that it would invest $2 billion in Binance, the world's largest cryptocurrency exchange, using USD1, a stablecoin controlled by the World Free Financial Corporation.

Purchasing Trump-style "magic beans" is like when foreign dignitaries stayed at the Trump International Hotel in Washington, DC during their first administration, and is a means of gaining influence. However, in comparison, the actions of World Free Finance Corporation make hotel rentals seem trivial. The more funds flowing into WLFI and USD1, the more legal and valuable these currencies will appear, and their market value will rise. Tether, the world's largest stablecoin, has a market value of nearly US$150 billion and a daily trading volume of more than US$30 billion. World Free Finance Corporation is eager to create a similar influence.

The American public has long been so flooded with news about the Trump family’s pursuit of selfish interests that many of their actions have almost stopped sensation today.

Just this week, it was reported that the government was preparing to accept a luxurious Boeing 747-8 aircraft donated by the Qatar royal family to use it as the new Air Force One, at least until Boeing completes the new Air Force One. The Defense Department will receive the plane, but it will be reportedly donated to his presidential library when Trump leaves office, making the $400 million aircraft a private property — although the arrangement appears to be a clear violation of the terms prohibiting U.S. officials from accepting gifts from foreign leaders and governments. (Trump has eased ethical concerns by saying that rejecting gifts is "stupid.")

However, in the cryptocurrency field, opposition within Congress is rising in business activities against Trump. Last week, some Democratic senators refused to pass a popular pro-cryptocurrency bill due to the president's naked profit-making behavior. "The negative effects of this behavior are obvious," Sen. Cynthia Loomis, a Republican of Wyoming, said in a recent interview with the New York Times. However, the Trump family seems to be accurately betting on the fact that no one can really stop them.