New York Times reporter Ezra Klein spoke with Bloomberg reporter Zeke Faux about the “shocking” potential for corruption surrounding the Trump family’s involvement in the world of crypto.
“It’s like muzzle velocity for political corruption here,” said Klein. “There are so many stories that, on their own, seem like they should be era-defining political scandals. But the big picture— from Trump trading cards, where he looks like a firefighter or whatever, all the way to the Trump stablecoin, Trump media launching (exchange-traded funds) — is that the Trump family has been groping its way, evolving, learning how to open up a lot of avenues to let people invest in various crypto schemes of theirs.”
“They can’t deny that people are giving them money, but their claim is that they are still acting in what they believe to be the U.S.’s best interest. But the conflicts of interest are so obvious,” said Faux. “… And in fact, once Trump’s appointees took over at the S.E.C., they announced that memecoins were collectibles, like Beanie Babies, and that the rules did not apply.”
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Faux estimates the Trump family has generated “at least $700 million” off crypto. It was not clear how much of this included purchases from foreign leaders and billionaires seeking favor.
World Liberty, for example, produces a coin that should not seem appealing to investors because Faux says they are “literally impossible to resell.” However, 75 percent of all the money World Liberty makes is paid to the Trump family as a fee, which provides a motivation all by itself. Chinese-born crypto billionaire Justin Sun, who is facing an S.E.C. investigation, bought $30 million of these “unresellable World Liberty tokens” right after the election, and then later bought another $45 million, “which meant that the Trumps were going to get something like $56 million in a payout based on just what he bought,” Faux said.
“A few weeks after Sun finished his $75 million purchase, his S.E.C. case was put on hold. No explanation was given,” Faux said.
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The controversy over people spending money at the Trump Hotel in D.C looks “quaint” by comparison, Faux added. “That was a couple hundred thousand dollars. Now people are sending millions to buy Trump’s coins.”
“Tens of millions,” said Klein. “The thing about the crypto play here is it’s so much more scalable. The number goes up."
"Yes. And they ended up selling out. They sold all the (World Liberty Financial) tokens that they had offered — a total of $550 million worth. So that meant $400 million to the Trumps, based on the terms of the offering as I read them,” said Faux.
A company called Freight Technologies also recently announced it was buying $20 million of Trump’s memecoin, phrasing it as “an effective way to advocate for fair, balanced and free trade between Mexico and the U.S.”
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“So, what is a company like that doing, publicly announcing a multimillion-dollar investment in the Trump memecoin? What are they saying this memecoin investment is buying them?” asked Klein.
“It seems like those guys are talking about using it to buy access,” said Faux.
Klein said the U.S. system is still trying to find a way to deal with a figure so effortlessly corrupt, backed by a political party so willing to enable the corruption.
“This guy, with his bizarre genius for shamelessness, is just doing it all so unbelievably directly. The coin is called $TRUMP. He’s just promoting it himself. It’s all for him… He has control of the Republican Party, so they’re not going to do anything to him. And they control Congress,” said Klein. “He sort of overwhelms the system’s capacity to know what to do about him, because it never had any defense for something so over the line that the administration refuses to treat as a problem."
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“The thing that is supposed to happen in government is somebody says: ‘Hey, you’re taking a bribe. You’re trying to make yourself rich off this,’" Klein added. "And he says: ‘Oh, of course I’m not. I would never do that. How dare you impugn my integrity. But Trump is instead like: ‘Yeah, I mean, wouldn’t you?’"
Read the full NY Times interview at this link.