A new report suggests that President Trump and his family directly received most of WLFI's revenue. The Trump family enjoyed 75% of revenue from Token Sale, around 400 million USD, and 60% from other sources.
If these numbers are even partially correct, they would raise significant concerns about potential conflicts of interest. They also raise questions about broader implications for transparency and accountability related to Trump's cryptocurrency policies.
Did the Trump Family Receive Money from WLFI?
World Liberty Financial (WLFI), a project affiliated with President Trump, has drawn significant attention in the cryptocurrency space since late last year. After persistent rumors about collaboration with Binance, WLFI has officially launched a new stablecoin, USD1. There is no clear evidence of Binance's involvement in this launch. However, a new report from Reuters has revealed some concerning details.
Essentially, the report suggests evidence was found about what percentage of WLFI's revenue goes directly to the Trump family. Trump would receive 75% of revenue from Token Sale and 60% from subsequent activities. WLFI has completed a large Token Sale, so the Trump family would receive approximately 400 million USD.
Reuters calculated that 5% of the money from this Token Sale would actually fund WLFI's platform, with the remainder belonging to other co-founders. Moreover, buyers cannot actually resell their tokens, and it is unclear whether they can influence any governance actions. There is no clear reason for small individual investors to actually purchase these assets.
If these numbers are correct, they could represent a serious conflict of interest and a serious threat to the US economy. First, community leaders like Vitalik Buterin have warned about corruption from political meme coins like TRUMP. If Trump receives a portion from WLFI's Token Sale, it would be a large pathway for abuse.
Additionally, as Trump is making significant changes to US financial regulatory agencies, there might be no one investigating WLFI's corruption allegations. For example, TRON founder Justin Sun has invested 30 million USD in WLFI, and the SEC has settled a civil fraud case against him shortly after. The SEC has resolved all of its cryptocurrency enforcement actions, but this investment still seems relevant.
"You have a head of state responsible for his own regulation. The WLFI Token will be the perfect vehicle for foreign governments or oligarchs to transfer money to the president," former regulator Ross Delston stated.
The greatest danger might not come from political corruption or fears about cryptocurrency centralization. Trump recently outlined a plan to use stablecoins to promote dollar dominance, and WLFI now has its own stablecoin. It also has approximately 111 million USD in unrealized losses from cryptocurrency investments and claims it will use "other cash equivalents" in USD1's reserves.
The potential risks are very difficult to underestimate. With Trump's financial interests in WLFI, there is a clear motivation to promote the company's stablecoin as part of his "dollar dominance" program. If this leads to widespread investment in USD1 and the exchange rate cannot be maintained, the consequences could spread across the cryptocurrency market.
Simply put, this type of business is completely unprecedented for a sitting US President. A few Senators have investigated Trump's connection to WLFI. However, the lack of political power and weakened federal regulatory agencies might obstruct their ability to change anything.
