Former US President Donald Trump and his family are facing intense scrutiny over a series of cryptocurrency-related conflicts of interest and potentially corrupt dealings. Robert Reich, a prominent US scholar and former Secretary of Labor, published an article on September 17th, arguing that Trump and his family have profited massively from multiple cryptocurrency projects, potentially putting the entire US economy in jeopardy.
According to the New York Times, Trump's Middle East envoy, Steve Witkoff, struck a multi-billion dollar deal with Sheikh Tanoun bin Zayed, head of the UAE's sovereign wealth fund and a member of the royal family. In return, the UAE invested $2 billion in World Liberty Financial, a company founded by Trump and the Witkoff family, and the White House agreed to ship hundreds of thousands of cutting-edge chips to the UAE, despite national security concerns that they could potentially be diverted to China.
Reich noted that this is just the "tip of the iceberg." Trump and his sons founded World Liberty Financial just days before the 2024 election. Funds poured in rapidly after Trump's victory. He subsequently launched memecoins named "TRUMP" and "MELANIA," and within weeks of taking office, proposed establishing a "national crypto reserve," which led to a surge in the value of the cryptocurrency.
Forbes estimates that the Trump family has profited approximately $3 billion from cryptocurrency, with the majority of the funds coming from overseas buyers, and crypto assets now account for more than half of their net worth.
Even more worryingly, the U.S. Securities and Exchange Commission (SEC), under the leadership of pro-Trump official Paul Atkins, has significantly relaxed regulations. They not only stopped pursuing a crypto fraud case against Chinese tycoon Justin Sun but also dropped a money laundering lawsuit against Binance, which had recently launched a Trump-related token.
Meanwhile, the Trump Department of Justice disbanded the National Cryptocurrency Enforcement Team, despite the fact that crypto scams in the United States cost the US $9.3 billion in 2024.
On the legislative front, the crypto industry has invested heavily in Congress to pass the GENIUS Act, which would legalize stablecoins. While the bill prohibits lawmakers and their families from profiting from stablecoins, it does not impose restrictions on the president. Reich warned that this would allow cryptocurrencies to penetrate deeply into the mainstream financial system, potentially triggering systemic risks similar to the 2008 subprime mortgage crisis.
U.S. Treasury Secretary Scott Bessant also predicted that under the new legislation, crypto companies could hold over $2 trillion in U.S. Treasury bonds as collateral. In the event of a market crash, a massive sell-off could cause U.S. Treasury prices to plummet, triggering a global financial crisis.
Reich bluntly stated that cryptocurrencies "have no social value," but that Trump, for personal and family gain, is pushing this highly speculative and risky industry into the heart of the economy, potentially leaving "the entire world to pay the price."
