The latest Trump family business venture — originally pitched as a DeFi platform dubbed “The Defiant Ones,” but has since been rebranded as World Liberty Financial — is fraught with controversy just days after it was unveiled.
While Trump’s eldest sons, Eric Trump and Donald Trump Jr., are “ambassadors” of World Liberty Financial, CoinDesk reports that the once “Defiant” company is also linked to individuals involved in liquidity protocol Dough Finance.
Recall how Dough Finance lost $1.8 million in Ethereum (ETH) and USD Coin (USDC) to a flash-loan attack on July 12.
Zachary Folkman and Chase Herro – the duo that built Dough Finance — are bosses at the new Trump-led firm, too. They started the companies Date Hotter Girls LLC and crypto-focused Pacer Capital, respectively.
Trump first endorsed the decentralized finance project in an Aug. 22 post on Truth Social. He posted about it again on Aug. 29 (by then it was dubbed World LibertyFi).
The X accounts of two of his family members were subsequently compromised and used to promote a fake Solana-based memecoin. One of the targets was Lara Trump, who is co-chair of the Republican National Committee.
The whole initiative sounds fishy to crypto venture capitalist and Trump supporter Nic Carter, who didn’t mince words on the matter. “This is a huge mistake,” he said per Politico. “It looks like Trump’s inner circle is just cashing in on his recent embrace of crypto in a kind of naive way, and frankly it looks like they’re burning a lot of the goodwill that’s been built with the industry so far.”
“Goodwill?” It’s worth mentioning that some of the sector’s most famous names have been found guilty of fraud.
Former Binance CEO Changpeng Zhao received a four-month sentence in prison; crypto entrepreneur Do Kwon spent more than six months in a Montenegrin prison; and FTX founder Sam Bankman-Fried was sentenced to 25 years in prison.
Trump is also no stranger to having his business ventures marred by illegalities (see Donald J. Trump Foundation and Trump University). He is also the first former U.S. president to be convicted of felony crimes.
Trump, crypto and trust
Trump, who once said he was “not a fan” of Bitcoin (BTC), has been weaving pro-crypto policies into his stump speeches in the lead-up to the 2024 presidential election.
In May, he became the first major political candidate to accept crypto donations. Crypto celebrants then received a flurry of promises should Trump be re-elected: a government-backed crypto reserve and the firing Gary Gensler, the oft-critiqued current Securities and Exchange Commission chair.
His one-eighty won him the support and financial backing of such deep pockets as Cameron and Tyler Winklevoss — founders of the Gemini exchange — who gave $1 million in Bitcoin each to the former president.
But since then, fraudsters have targeted his so-called “MAGA” base with fake crypto websites and misleading donation centers. In June, a London-based cybersecurity company called Netcraft began monitoring several attacks surrounding the Trump campaign, discovering fraudulent donation schemes and phishing attempts.
The latest scrutiny surrounding World LibertyFi and its World Liberty Coin is no different.
For weeks, the Trump brothers teased a financial venture that would challenge traditional banking. And when it debuted, scammers had plenty of new fodder to work with.
Carter, who remains a Trump supporter (because “Trump himself is only tangentially involved”) warns that the World Liberty project “genuinely damages” the Republican nominee’s electoral prospects. Polls indicate that the presidential race against Democratic Vice President Kamala Harris is extremely tight.
“It’ll be the juiciest DeFi target ever and it’s forked from a protocol that itself was hacked. [It’s] also an obvious target for the SEC,” he wrote on Sept. 3. “At best it’s an unnecessary distraction, at worst it’s a huge embarrassment and source of (additional) legal trouble,”