Trump’s Crypto Holdings Raise Ethics Concerns As Experts Warn of Potential Conflicts
TEHRAN (Tasnim) – Ethics experts are raising alarms over Donald Trump’s cryptocurrency holdings, warning that a long-standing exemption from federal conflict-of-interest rules could allow him to push pro-crypto policies while financially benefiting from them.
Federal ethics rules prohibit government employees from engaging in matters that could financially benefit them. In a 2022 opinion, the US Office of Government Ethics stated that federal officials should recuse themselves from crypto-related issues “when there is a real possibility that the matter will result in a gain or loss to the employee’s digital assets.”
The guidance provided an example of an official advocating for US currency backing of certain cryptocurrencies, which could financially benefit their personal holdings.
Trump, whose Trump Organization affiliate holds a stake in the cryptocurrency $TRUMP, an “official” Trump-themed meme coin, could fall under such scrutiny. However, a longstanding exception dating back to the 1980s exempts the president from these conflict-of-interest rules, heightening concerns among ethics watchdogs.
“If you’ve got a direct, personal financial connection to the crypto industries, there’s a self-interested motivation to create the easiest possible path for the crypto world,” said Dylan Hedtler-Gaudette, director of government affairs at the Project on Government Oversight.
By contrast, Trump’s nominee for Director of National Intelligence, Tulsi Gabbard, has stated she will divest from her cryptocurrency holdings—worth tens of thousands of dollars—if confirmed.
Supporters of the $TRUMP coin, which operates on the Solana blockchain, insist it is not an investment but rather an “expression of support for, and engagement with, the ideals and beliefs embodied by the symbol ‘$TRUMP’ and the associated artwork.” Despite this, the coin has attracted a flood of investors, pushing its theoretical market capitalization above $5 billion as of Monday.
Democratic lawmakers have voiced concerns about the financial interests of Trump and First Lady Melania Trump, who each have separately branded cryptocurrencies. They argue the couple could engage in a "rug-pull" scheme, profiting from their ownership while leaving investors at a loss.
“We write with deep concern about the decision by President Trump and First Lady Melania Trump to launch two meme coins, $TRUMP and $MELANIA, that allow them to earn extraordinary profits off his Presidency,” Senator Elizabeth Warren and Representative Jake Auchincloss wrote in a letter to regulators last week.
“These coins do not create new, faster, cheaper, and safer payment rails. These coins do not help people borrow more affordably. They do not improve the financial system in any way for consumers,” they added.
The cryptocurrency industry has spent more than $100 million supporting Trump and other pro-crypto candidates in the current election cycle. His pledges to deregulate the sector and establish a US strategic Bitcoin reserve have contributed to record-high Bitcoin prices in recent days.
The Trump administration’s extensive business connections raise broader concerns about potential conflicts of interest. Billionaire Elon Musk, who is spearheading Trump’s federal spending reduction initiative through the Department of Government Efficiency, owns several companies with government contracts that could be significantly affected by regulatory changes.
