Donald Trump’s growing ties to the cryptocurrency industry, alongside his administration’s pro-crypto stance, have ignited ethical concerns and fears of regulatory rollbacks that could enable financial abuses. Critics argue that Trump’s blending of personal financial interests with political influence is setting a dangerous precedent.
During his 2024 presidential campaign, Trump courted the cryptocurrency sector, urging companies to ramp up campaign contributions to secure his White House victory. Despite previously labeling bitcoin a “scam” in 2021, Trump reversed course last fall by launching a crypto venture, World Liberty Financial, alongside his sons. Days before his inauguration, Trump unveiled a personal cryptocurrency, the $Trump meme coin, triggering widespread criticism from ethics experts.
Eswar Prasad, a professor of economics at Cornell University, criticized Trump’s actions, stating, “The Trump meme coin represents the intersection of Trump’s grifting tendencies and his administration’s embrace of cryptocurrencies, along with his dismissive attitude toward government regulation.” Prasad also warned that Trump’s policies could lend undue legitimacy to crypto assets, exposing retail investors to the volatility of such speculative investments.
The crypto industry’s fortunes soared with Trump’s election, as companies poured millions into his campaign and inaugural events. The lavish “crypto ball” and intensified lobbying efforts signaled the sector’s rising influence. Trump further solidified these ties by appointing crypto-friendly figures to top regulatory positions, including Paul Atkins, who now chairs the Securities and Exchange Commission (SEC). Additionally, Trump named David Sacks, a venture capitalist and cryptocurrency advocate, as his administration’s first crypto and AI czar.
Sacks, speaking at the crypto ball, declared, “The reign of terror against crypto is ending.” On the same night, Trump launched $Trump on his Truth Social platform, causing the coin’s value to skyrocket before his inauguration, significantly increasing his net worth.
Ethics watchdogs have condemned Trump’s actions. Larry Noble, former general counsel for the Federal Election Commission, called the move “outrageous,” arguing that it opens the door for anonymous transactions that could favor Trump’s administration. “The anonymity involved with cryptocurrency transactions will apparently allow anyone looking for favorable treatment from Trump’s administration, including US businesses, as well as foreign actors and countries, to participate in making Trump wealthier than ever by just buying his token,” Noble stated.
Further criticism came from Democratic Senator Elizabeth Warren, who said, “Trump should be focused on lowering costs for Americans, not conning them out of their savings to juice the value of crypto tokens for himself and his family.”
Trump’s broader crypto agenda has raised concerns over economic risks. Prasad warned that proposals like establishing a bitcoin reserve for the US could destabilize the economy. “This is neither a strategic nor sensible idea but instead benefits bitcoin holders while sticking US taxpayers with the bill,” Prasad noted.
Despite mounting criticism, Trump’s pro-crypto policies continue to gain traction, fueled by tens of millions in industry lobbying and campaign donations. Ripple, a leading crypto company, pledged $5 million of its cryptocurrency to Trump’s inaugural fund, while hiring key Trump allies as lobbyists.
Amid these developments, crypto-related crimes and fraud are on the rise. A Chainalysis report revealed that North Korean hackers stole $1.34 billion in cryptocurrency in 2024, doubling the previous year’s amount and funding weapons programs. Meanwhile, US citizens reported $5.6 billion in crypto fraud losses in 2023, according to the FBI.
Stefan Cassella, a former federal prosecutor, highlighted the dangers: “The crypto world is just the latest context in which fraudsters and grifters have learned to operate. It’s a shiny new object that people want to reach for in the hope that it will make them rich.”
As Trump’s administration champions the growth of cryptocurrency, critics warn that unchecked expansion could pave the way for financial instability and unchecked corruption. Calls for stricter regulations continue to clash with the administration’s deregulation efforts, leaving the future of US crypto policy uncertain.