Trump Crypto Venture Collaborates with a Platform Associated with Middle Eastern Terrorists
The crypto platform that U.S. President-elect Donald Trump and his new Middle East ambassador, billionaire Steve Witkoff, just introduced has teamed with criminals and Iran-backed militant groups Hamas and Hezbollah, according to financial experts and authorities.
According to six experts in U.S. government ethics, World Liberty Financial Inc., which was established by the Witkoff family two months before to the November U.S. election and included Trump as a financial benefactor, raises ethical and conflict of interest issues.
The Tron cryptocurrency platform, World Liberty’s new partner, is one of their main worries.
According to a 2023 Reuters report, which cited interviews with seven financial crime experts and cryptocurrency investigations specialists, the Tron network has surpassed Bitcoin as a means of facilitating cryptocurrency transfers linked to organizations that have been classified as terrorist organizations by the US, Israel, and other nations. This is because the Tron network is quicker and less expensive than Bitcoin.
Last month, Tron declared its intention to invest $30 million in World Liberty. On social networking platform X, Sun and World Liberty announced that Justin Sun, the founder of Tron and a Chinese entrepreneur, will serve as an advisor to the Trump-Witkoff partnership. According to Sun, Tron, a company registered in the British Virgin Islands, is now World Liberty’s biggest investor.
The use of Tron by extremists, such as Hamas, whose 2023 attack on Israel killed 1,200 people, according to Israeli officials, and sparked the Gaza war, has been a common target of cryptocurrency seizures publicized by the Israeli security agencies since 2021.
Since July 2021, 186 Tron wallets have been frozen by Israel’s National Bureau for Counter Terror Financing (NBTCF), which is in charge of such seizures, on the grounds that they were utilized by a “designated terrorist organization” or for a “severe terror crime.” Of those, Israeli officials connected 39 to Hezbollah, 63 to unidentified terrorist organizations or money dealers, and 84 Tron wallets to Hamas or Hamas affiliates, including Islamic Jihad. On March 28, the latest Tron seizure was reported.
The use of Tron by violent organizations was not independently established by Reuters, and the NBTCF did not back up its claims or answer inquiries for further information. Requests for comment were not answered by Hezbollah or Hamas.
Though it did not directly address allegations that it has been used by extremists, Tron, which makes money via transaction fees on its network, told Reuters that its technology “has attracted both lawful users and those with illicit motives.” In response to inquiries for this story, a Tron representative stated that the firm “has taken proactive measures to address the risk of illicit activities on its network.” The spokeswoman added that $70 million in illegal money were frozen as a result of a partnership with law enforcement that was started in September. A request for comment from Sun, the founder, was not answered.
Eric Trump told Reuters on the fringes of a crypto conference in Abu Dhabi that while criminal organizations using cryptocurrency was “everyone’s foremost concern,” regular banking institutions were also being exploited to transfer “bad money.” Trump’s second son stated that the cryptocurrency business would “do a great job” of regulating itself when it comes to illicit flows, adding that “anything can be manipulated if used by the wrong people, and you have to crack down on it.”
Tron wallets have also been confiscated by the U.S. Treasury agency, including one connected to an organization that the agency claims solicited funds for Hamas during the 2023 attack on Israel. A money changer headquartered in Lebanon was sanctioned by the Treasury in March for allegedly giving Hezbollah leaders cryptocurrency accounts, including a Tron wallet, so they could receive money from Iran.
Ethics experts expressed alarm over Tron’s participation in World Liberty.
Kathleen Clark, a professor of government ethics at Washington University in St. Louis, stated, “There are red flags all over this.” The amount of Tron’s stake in World Liberty, the possibility that Trump might profit financially from it, and the purported use of Tron by violent groups like Hamas and Hezbollah are some of her worries.
She also brought attention to the U.S. Securities and Exchange Commission’s inquiry against Sun, the creator of Tron. The SEC filed a fraud case against Sun in 2023, alleging that he had concealed payments to celebrities to endorse his businesses and inflated trade volume. The SEC allegations “lack merit,” according to Sun, a Grenadan citizen with headquarters in Switzerland. The matter is still pending.
When Trump’s government takes over the SEC in January, Clark wondered if World Liberty’s tight ties to Sun might present a conflict of interest.
Questions concerning Trump’s financial connections to World Liberty, the Tron investment, and possible conflicts were not immediately addressed by Trump or his transition team representatives. According to transition spokesman Karoline Leavitt, “President Trump did not enter politics for financial gain.”
“He is fighting because he wants to restore America’s greatness and because he loves its people.”
According to several cryptocurrency specialists, Tron is popular with criminals and militant organizations because it allows users to hide their identities, has cheap costs, and is readily convertible into cash.
POSSIBLE DISPUTES
According to the provisions of the business, Witkoff co-founded World Liberty and owns stock in WC Digital Fi, LLC, which is entitled to a portion of World Liberty’s profits. He donates to Trump’s Republican presidential campaign and is a personal friend of the president.
According to a source acquainted with Witkoff’s plans who asked not to be named, he intends to place all of his interests in a “blind trust.” But according to the source, Witkoff would continue to own his property. An independent manager often oversees an official’s assets in a blind trust, selling off those that present a conflict and reinvesting the money in ventures the owner is unaware of.
Witkoff remained silent. Requests for comment about possible moral dilemmas and Tron’s stake in the business were not answered by World Liberty.
The ethical experts told Reuters that World Liberty creates possible conflicts of interest even when there is a trust.
They added that Witkoff’s views on what is best for World Liberty rather than the United States may influence his suggestions for Middle East policy. Potential conflicts arise as long as Witkoff retains a financial stake in World Liberty, even if he creates a trust and stays out of the day-to-day operations of the corporation, according to Richard Painter, a professor at the University of Minnesota and former president George W. Bush’s ethics lawyer.
“It makes absolutely no difference if you are part of the company’s management or not. “What matters is whether you have a financial stake that your government work may directly affect,” Painter said.
According to analysts, Trump may potentially run afoul of World Liberty.
According to World Liberty’s terms and conditions, Trump is entitled to a portion of its profits and is identified on the organization’s website as the “chief crypto advocate.”
According to those terms and conditions, World Liberty distributes a proprietary token that, in contrast to Bitcoin and other cryptocurrency tokens, cannot be sold.
According to the conditions, Trump and other unidentified “affiliates” are entitled to 75% of some World Liberty income, which increases the likelihood that individuals will purchase World Liberty coins in an effort to curry favor with him.
“Is this an alternative way of ingratiating yourself with Trump?” “World Liberty,” Clark replied.
During his first administration, Trump’s financial dealings came under intense investigation. A study released by House Democrats in January claims that during his time in office, at least 20 governments—including Saudi Arabia and China—spent a total of over $7.8 million at his hotels and other businesses. There were no legal repercussions for Trump’s expenditures.
When World Liberty asked the Trump transition team what actions he would take to resolve any problems, they did not reply.
The link between World Liberty and Trump is prominently shown on the company’s website. Visitors are greeted on the main page with an image of Trump with his ear bandaged following the July assassination attempt. Trump and his three kids, Don Jr., Eric, and Barron, are the first individuals named as part of the World Liberty team. They are referred to as “Web3 ambassadors.” During a live event on X in September, Trump and his family members and allies revealed the company. Requests for comment from Barron and Don Jr. were not answered.
According to the experts, Trump and his family may also profit from any crypto-related regulatory reforms his government adopts through World Liberty. Trump promised during the campaign to choose a new SEC head to succeed Gary Gensler, who sued the cryptocurrency business on a number of occasions. He hired Paul Atkins, a crypto-friendly attorney from Washington, for the position last week.
Alex and Zach, Witkoff’s kids, are also named as World Liberty co-founders. Requests for comment were not answered. According to Eric Trump, he is “very involved” with World Liberty.
According to Larry Noble, a professor at American University and former general counsel of the Federal Election Commission, Witkoff and Trump might be in violation of the U.S. Constitution’s “emoluments” clause, which is intended to prevent corruption and improper influence on government, if foreign governments or sovereign wealth funds invested in World Liberty. Without legislative consent, the provision prohibits federal officials from taking gifts or other benefits from foreign governments.
Given his inexperience in international politics, diplomats expressed astonishment when Witkoff, a real estate mogul from New York, was appointed special Middle East envoy on Nov. 12. He will take up the position during a period of increased regional tensions, such as the fighting in Gaza, the unrest in Syria, and the possibility of an open clash between Iran and Israel.
In December 2023, Witkoff gave $250,000 to MAGA Inc., a pro-Trump super PAC expenditure group. Forbes estimates that he is worth at least $1 billion.
The distinction between Witkoff’s diplomatic job and his commercial endeavor is already becoming more hazy. Witkoff was a speaker at the Abu Dhabi crypto conference on Monday. In his biography, the show noted the cryptocurrency industry and named him as Trump’s special ambassador to the area. According to the conference website, “A forward-thinking entrepreneur, Steve is now focused on the intersection of real estate, Bitcoin, and crypto,” a new tab opens. Access to the exclusive sessions, which were off-limits to the media, cost attendees up to $9,999. Sun from Tron was also mentioned as a speaker.
Witkoff did not answer inquiries concerning the meeting.
ENVOY SPECIAL, FEW RULES
The U.S. Senate may not need to confirm Witkoff’s new position as special envoy because it is not legally defined. The director of advocacy at Transparency International’s Washington office, Scott Greytak, suggested that the next administration would designate him as a “special government employee,” a term intended for temporary positions.
Then, he claimed, “he can continue receiving outside income without limits, unlike regular government employees.” “He cannot, however, take any official actions that would financially benefit himself, and he must file a financial disclosure form.”
Meredith McGehee, an independent ethicist and former policy director of nonprofit watchdog the Campaign Legal Center, suggested that Witkoff should also sign a contract with the State Department that prohibits him from discussing cryptocurrency with foreign government officials while on official duty. “It ought to be a wall. ‘By the way, what’s your government planning to do on crypto?’ is not applicable. McGehee spoke those words.
In an examination of the ambassadors, Reuters discovered that special envoys under Biden, previous President Barack Obama, and Trump’s own first administration were mostly not from the corporate sector. Weeks before the election, none had established a significant business associated with a presidential contender.
On the other hand, several have substantial private sector investments. According to a 2021 certificate of divestiture from the U.S. Office of Government Ethics, multimillionaire John Kerry sold assets that government ethics authorities believed would be in conflict with his position as Biden’s special climate envoy.
Trump has already named a close business colleague. In 2016, he appointed Jason Greenblatt, the chief legal officer of the Trump Organization, as Special Representative for International Negotiations, a crucial position in negotiations between Israel and the Palestinians. Greenblatt told Reuters that before to joining the White House, he left Trump’s firm. He said he would have complied with the relevant regulations, but he could not remember if he had liquidated his interests before to serving as a special envoy.
