Donald Trump has returned to the White House under a cloud of controversy after launching a multibillion-dollar cryptocurrency venture involving personal meme coins, $TRUMP and $MELANIA.
Speaking to reporters on Tuesday, President Donald Trump briefly addressed the TRUMP memecoin, which debuted on January 17, just days before his inauguration.
“I don’t know much about it other than I launched it,” Trump remarked. “I heard it was very successful. I haven’t checked.”
The move has some pro-crypto takers who see the development as a game-changer for the industry.
“The fact that a president is doing this brings some sort of legitimacy to the space, and I think just means that the industry is moving ahead in a way it hasn’t for the last 10 years,” said Paul Howard, senior director at crypto market-maker Wincent
However, ethics officials and presidential experts have largely condemned the move, citing conflicts of interest that could damage public trust in the presidency.
“There are shameful and major conflicts of interest with respect to his family business benefiting from his cryptocurrency policies,” said James Thurber, the founder and former director of the Center for Congressional and Presidential Studies.
Trump “does not seem to worry about the public interest with respect to cryptocurrency”, added Thurber.
“He seems to be driven by profit and wanting to be a major part of the billionaire class in the US.”
The coins debuted just days before Trump’s inauguration, with $TRUMP launched on Friday and $MELANIA following on Sunday.
$TRUMP a setup to help the Prez profit from crypto: ethics experts
Walter Shaub, former director of the US Office of Government Ethics, criticized Trump’s actions as a fundamental threat to ethical governance.
“America voted for corruption, and Trump is wasting no time delivering it,” said Walter Shaub, the former director of the US Office of Government Ethics, who served under former presidents Barack Obama and Trump.
“What was once a government ethics program, made partly of laws and partly of norms, is a smoldering crater,” he said.
Much of the concern stems from the intertwined interests of Trump’s administration and his business ventures.
CIC Digital LLC, an affiliate of the Trump Organization, and Fight Fight Fight LLC, co-owned by CIC Digital, collectively hold 80% of the tokens, which means that Trump-linked businesses could have gained $8 billion worth of crypto over the weekend.
Similarly, $MELANIA is offered by MKT World LLC, a firm Melania Trump incorporated in 2021.
Critics argue this setup allows the Trumps to profit from industries they simultaneously regulate, with potential national security implications.
The Securities and Exchange Commission (SEC) on Tuesday already took its first step towards reducing regulatory barriers for the cryptocurrency industry by launching a “crypto task force” to create a clear and comprehensive regulatory framework for crypto assets.
Legal fallout looms for TRUMP meme coin?
Legal experts foresee lawsuits on the horizon.
Preston Byrne, a cryptocurrency-focused attorney, predicted a 90% chance of legal action within two weeks, citing the likelihood of financial losses and regulatory scrutiny.
Despite their initial market boom, with the TRUMP memecoin hitting a market cap of $13 billion during its peak over the weekend, both tokens have been quite volatile ever since.
TRUMP’s market cap has fallen to approximately $8 billion, with the token currently trading around $42.
Additionally, watchdog groups like the Project on Government Oversight raised alarms over the lack of oversight in Trump’s crypto ventures.
“Besides being a blatant financial conflict of interest, this deepens Trump’s engagement in a sector with significant national security risks,” said Danielle Brian, the group’s executive director.
Nic Carter, a prominent crypto investor, highlighted another danger: foreign influence. “Personal meme coins open the door for foreign actors, including sanctioned individuals, to gain leverage over US leaders,” he said.
Democratic lawmakers, including Representative Maxine Waters, have called for greater transparency and accountability.
“Anyone globally, even individuals sanctioned by the US, can now trade and profit off of $TRUMP through unregulated platforms,” Waters warned.
Meme coins: fad or financial risk?
While meme coins like $TRUMP and $MELANIA are marketed as fun, non-investment assets, their extreme volatility and speculative nature worry critics.
Carol Alexander, a finance professor at the University of Sussex, likened the coins to fan tokens that rise and fall with public sentiment.
However, even fans acknowledge the risks.
Both tokens lost value during Trump’s inaugural events, though their combined valuation remained above $9 billion.
Such dramatic fluctuations underscore the precarious nature of meme coins as financial assets.
The post TRUMP meme coin sparks ethics firestorm as critics decry conflicts of interest appeared first on Invezz
