Just over a year ago, I stood in a gilded Washington, D.C. ballroom during inauguration weekend, surrounded by the blockchain industry’s top executives and investors. They had traded in their hoodies for tuxedos and gowns, celebrating the ascension of the first “crypto president,” Donald Trump, who had embraced the once-renegade sector on the campaign trail. But halfway through the night, whispers began spreading through the crowd that Trump, who was not in attendance, had launched his own memecoin. Around the end of a DJ set by Snoop Dogg, the Trump coin had crossed $1 billion.
Some of the shrewder members of the audience immediately clocked what was happening. Trump, who has made a career out of branding everything from casinos to steaks to unaccredited colleges, was doing the same with crypto. Would Trump’s latest business venture go the way of Trump Tower or Trump University?
As we quickly found out, the quality of the Trump family’s crypto endeavors was almost a red herring (though we have reported closely on it, including in my colleague Ben Weiss’s terrific new feature on American Bitcoin). Instead, ethics watchdogs have argued that Trump has used his blockchain businesses as a way to sell access. But unlike concerns during his first term that foreign dignitaries could book rooms in Trump hotels, which taught the term “emoluments” to millions of Americans, now anyone with an internet connection could effectively wire Trump millions of dollars by setting up a digital wallet and reap the rewards. His top memecoin holders enjoyed a private audience with the president last May, though they weren’t all pleased by the food they were served.
In hindsight, those ethics concerns also look quaint. On Saturday night, the Wall Street Journal published a bombshell report that two lieutenants to a member of the Abu Dhabi royal family signed a contract to funnel $500 million into World Liberty Financial, the Trump family’s crypto platform, in exchange for a 49% ownership stake, just days before his inauguration. As the Journal plainly stated, this was something unprecedented in American politics: “A foreign government official taking a major ownership stake in an incoming U.S. president’s company.” And just a few months later, the Trump administration granted the United Arab Emirates access to advanced U.S. chips despite widespread security concerns (though a World Liberty spokesperson told Fortune that the deal had nothing to do with the administration’s actions on chips).
As the shockwaves of the scandal reverberate, an awkward question lingers: Is Trump bad for blockchain? The industry spent hundreds of millions of dollars on the 2024 election, culminating in the coronation of Trump, who has championed digital asset regulation, hosted summits, and appointed czars. But now, the landmark Clarity Act is stalled in the Senate as Democrats call for ethics provisions that would prohibit the president from profiting off crypto holdings, and that groundswell of opposition is only likely to grow. And despite Trump’s cheerleading, Bitcoin prices are nearly at their lowest price in a year, with many retail traders staying away.
For many Americans, crypto is now inextricably linked to the Trump family. Be careful what you wish for.
Merger madness…SpaceX completed a long-rumored acquisition of xAI, both Elon Musk companies, in a stunning deal that could set the joint venture up for one of the largest IPOs in history by market value. This comes months after xAI acquired X, another Musk venture, in a $33 billion, all-stock deal, and a month after Tesla revealed it had invested $2 billion in xAI. According to reporting in Bloomberg, the new deal will lead to a combined enterprise value of $1.25 trillion. You can read all about it here.
Leo Schwartz
X: @leomschwartz
Email: [email protected]
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This story was originally featured on Fortune.com
