- US Democrats escalated their response to potential conflicts of interest related to President Trump’s family involvement in cryptocurrency and walked out of a key congressional hearing.
- The Senate opened a preliminary investigation into the $TRUMP memecoin and World Liberty Financial, both linked to the Trump family.
- Concerns about these connections could affect the progress of pending crypto legislation, including the GENIUS Act and stablecoin regulation bills.
Democratic lawmakers in the United States intensified scrutiny over President Donald Trump and his family’s ties to cryptocurrency, highlighting concerns about conflicts of interest. On Tuesday, members of the House Financial Services Committee, led by Ranking Member Maxine Waters, exited a joint hearing with the Agriculture Committee focused on digital assets, as reported by the committee’s official calendar.
At the same time, Senate Permanent Subcommittee on Investigations Ranking Member Richard Blumenthal launched an inquiry into the $TRUMP memecoin and World Liberty Financial (WLF), a crypto company majority-owned by the Trump family that recently introduced a U.S. dollar-backed stablecoin. Specifically, Blumenthal’s investigation aims to address how these businesses manage conflicts of interest related to their ties to the President.
During the weekend, some Democrats who have supported cryptocurrencies withdrew backing from the GENIUS Act—a Senate bill designed to set rules for stablecoins, or cryptocurrencies pegged to the U.S. dollar. The Senate Banking Committee approved the act, and a vote in the full Senate was scheduled for May 8, according to Politico. Senator Ruben Gallego suggested changes were possible before the upcoming vote, saying, “I’m hoping we could get it done by then. If we can’t then, yeah, then push back. But there’s no reason why we can’t.”
Senator Elizabeth Warren, a critic of the GENIUS Act, spoke in the Senate, stating, “They’re trying to jam it through because they know it will turbocharge the size and scale of the stablecoin market, and help boost the value of their own stablecoin ventures, all while containing no real restrictions on the President’s self dealing.” The act of granting $TRUMP coin holders access to a presidential dinner and a White House tour has raised more questions about these financial relationships.
Last week, it was revealed that the Trump-linked USD1 stablecoin was used in a $2 billion transaction by a company led by the brother of the UAE President. These revelations have put additional pressure on legislative efforts. Both the House and Senate are working on bills to regulate stablecoins, and the House recently released a new draft law to oversee crypto entities, following the bipartisan passage of the FIT 21 Bill last year—which the Senate did not approve.
When pressed on her decision to withdraw from the joint hearing, Representative Waters said, “I object to this joint hearing because of the corruption of the President of the United States and his ownership of crypto and his oversight of all of the agencies.” French Hill, Republican Chair of the House Financial Services Committee, responded, stating that Waters’ move introduced partisanship into a previously cooperative relationship. The hearing continued without Democratic participation, and Waters reportedly convened her own roundtable, according to Politico.
In his letters, Senator Blumenthal raised further issues about the influence of Justin Sun, the top holder of the $TRUMP coin, who holds nearly 1.4 million coins and is facing a civil fraud case from the SEC. Blumenthal pointed out the risk that the blockchain’s pseudonymity could conceal direct payments to the President, according to his letter to Fight Fight Fight, the issuer of the coin.
World Liberty Financial experienced a significant boost after Sun purchased $30 million of its tokens in November and another $45 million in January, following an initial period of low interest. The company, which has since attracted new partners, has faced further scrutiny due to associations with entities previously alleged to have participated in controversial market activities.
Lawmakers expect the pending vote on the GENIUS Act to indicate whether concerns over Trump-linked crypto interests will impact the future of digital asset regulation.
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