A government watchdog, Accountable.US, is accusing Donald Trump’s cryptocurrency project, World Liberty Financial Inc. (WLFI), of selling tokens to individuals and entities linked to sanctioned countries like North Korea and Iran. This has raised serious concerns about national security and regulatory compliance.
Shady Sales?
Accountable.US claims WLFI sold tokens to digital wallets connected to groups and platforms known for risky activities. These include addresses linked to North Korean actors and users who’ve interacted with Tornado Cash, a cryptocurrency mixer often used for money laundering. The watchdog provided examples of these transactions to back up its claims. They even called it an “American Sell-Out,” a label picked up by several news outlets. Accountable.US’s executive director stated that Trump’s crypto venture risks jeopardizing US workers and investors.
Foreign Connections and National Security Risks
The report highlights that many buyers used foreign exchanges and services unavailable to US citizens. This raises concerns about the true location and identities of some token holders. The watchdog argues that this situation is a national security issue because a cryptocurrency tied to a prominent US political family could be used for influence peddling or sanctions evasion. Analysis shows that at least 14 of the largest WLFI holders, controlling billions of dollars worth of tokens, used platforms restricted to US customers, strongly suggesting foreign ownership. While Accountable.US didn’t accuse WLFI of intentionally breaking the law, they called for a formal investigation.
The Trump Family’s Stake and Transparency Concerns
The Trump family reportedly owns a significant stake in WLFI—a massive holding of billions of tokens, worth potentially billions of dollars depending on the market price. This large holding has increased demands for greater transparency regarding who bought the tokens and how WLFI screened its buyers.
Market Reaction and Regulatory Scrutiny
The news caused immediate market repercussions. WLFI’s price plummeted on its first day of trading, even before the watchdog’s report. The ongoing volatility, debates about frozen and released tokens, and the reactions from exchanges and token holders continue to keep WLFI in the news.