Donald Trump and Cryptocurrency Controversy

By MaxStock @Adobe Stock

President Trump is involved in another controversy. Surprised that it’s not just some everyday, political corruption disturbance? According to the NYT, this corruption has “eviscerated” boundaries between business and government and is “without precedent in modern American history.”

At Manhattan Contrarian, Francis Menton discusses the NYT’s “scathing exposé of alleged corruption of our current President.”

No surprise to MC readers, Mr. Menton has long viewed the “game of politics” as being inherently corrupt.

Politicians are able to use the powers of their offices in a thousand ways, large and small, to benefit themselves and their friends and supporters, and to disadvantage adversaries. Almost no human being is immune from the temptation to use those powers for such purposes at least a little. And thus there is no such thing as a politician against whom at least some charge of corruption cannot credibly be alleged.

With today’s massive and intrusive federal administrative state, the problem is far worse today.

Essentially every business is under the thumb of federal regulation — and even if a business is not currently regulated, it could be.

Every business is also taxed, and the taxes for any given business could be either increased or decreased at any time. So if a President is involved in changing regulation in any way, or in changing taxation in any way, or even in not changing regulation or taxation when some people say that he should, did he do that to benefit the financial interests of himself or his family, or did he do it because he thought it was good public policy? And don’t forget, it could be both!

Every politician is involved in activities that can “credibly be charged as corruption.” A far more critical question is whether the action in question is at least arguably illegal, and if so, what is the theory of illegality? Also, it’s fair to ask if something might not be right or good, even if it’s legal.

So then, how does the NYT fare in making its case? The subject of its big crypto article is a start-up by the name of World Liberty Financial. The majority of WLF is owned by The Trump Organization, which the NYT calls a “Trump family corporate entity.”

President Trump II has “significantly eased the federal regulation of the crypto industry, including ending SEC investigations and disbanding a Justice Department task force focused on the industry.” The NYT calls this a “broad unwinding of Biden-era scrutiny of the industry.” 

Below is the NYT’s list of the “range of conflicts of interest trailing the company.” 

• World Liberty has directly benefited from Mr. Trump’s official actions, such as his announcement of a federal crypto stockpile that would include a digital currency the firm has invested in. The president’s announcement caused a temporary jump in the value of World Liberty’s holdings.

• World Liberty has sold its cryptocurrency to investors abroad, including in Israel and Hong Kong, according to interviews and data obtained by The Times, establishing a new avenue for foreign businesses to try to curry favor with Mr. Trump.

• Several investors in World Liberty’s coin managed firms that the federal government accused of wrongdoing. They include an executive whose fraud case was suspended after he invested millions of dollars in World Liberty. Other investors and business partners, some of whom haven’t been publicly identified before, are looking to expand in ways that will require the Trump administration’s approval.

• World Liberty proposed swapping cryptocurrencies with at least five start-ups, and often used the Trump name to solicit steep payments as part of the deals. Even in an industry with a disreputable history, the deals raised alarm among veteran executives.

Mr. Menton wonders if that is the NYT’s best shot? The first allegation is the most serious: that “World Liberty has directly benefited from Mr. Trump’s official actions.”

And so have hundreds and hundreds of other businesses benefited from the broad de-regulatory agenda of the second Trump administration.

… despite the frequently over-heated language of the Times piece, it never makes any suggestion of illegality. If there is any basis under which this may be illegal, I am unaware of it.

The Manhattan Contrarian doesn’t stop there. Menton divides our politicians into three distinct groups:

• Category One: People, like Trump, who have come to office with substantial business interests that they have retained while in office. Examples include Lyndon Johnson and Jimmie Carter.

Mr. Menton feels free to use one non-presidential example, Nancy Pelosi.

• Category Two: Politicians who have served in public office for their entire careers and have never held a significant private sector job or business interest. Examples from Category Two include Bill Clinton and Joe Biden.
• Category Three: those who had a career in the private sector, but substantially cashed out before entering public service, and now just have investment portfolios. Category Three includes Ronald Reagan and the two Bushes.

Looking for political corruption, it might be best to have all politicians come from Category Three. As Mr. Menton notes, nothing in the Constitution requires that.

Advancing to the highest office is loaded with temptation to develop personal wealth by accepting large payments from third parties to influence government policy. Bill Clinton and Joe Biden are clear examples.

Bill Clinton created the Clinton Foundation in 2001 after leaving office, and the Foundation then raised more than $2 billion over the next 15 years, during much of which time his wife was widely expected to become the next President. Large donors included foreign actors with clear interests in influencing U.S. policy. The overhead of the Foundation provided hundreds of millions of dollars to fund the Clintons’ lifestyles and staff. This enterprise skirted extremely close to the edge of quid pro quo bribery.

In the case of Biden, between 2019 and 2023 I wrote an entire eleven-part series titled “Biden’s — Stone Cold Crooked,” explaining why the publicly available facts about the Bidens’ conduct in Ukraine and China made for a lay-down case of quid pro quo bribery. Somehow, the Biden Justice Department was never interested in pursuing the case.

Focusing on Category One, consider the case of Lyndon Johnson. Josh Blackman at the Volokh Conspiracy has a summary in a post from January 1, 2025. The summary is largely derived from the Robert Caro biography of Johnson. Lyndon and Lady Bird Johnson owned television and radio stations in the Austin, Texas area.

When Johnson became President, he purported to put his holdings, including the broadcast stations, in a “blind trust,” but Blackman notes that the trustees were close personal friends and the trust would never meet the technical requirements for a true “blind trust.”

Then there was Jimmie Carter, who retained his heavily regulated (and subsidized) peanut farm business while President, while also creating a half-baked “blind trust.”

… (Donald) Trump has not created a “blind trust,” but has withdrawn from “daily management” of his business interests and has turned that over to his sons.

Reuters quotes a supposed “ethics expert” as saying that Trump’s arrangements are “not good enough.” Did that ethics expert ever criticize the arrangements of Johnson or Carter?

Is the insubstantial distinction between Trump’s arrangements and the Johnson/Carter “blind trusts” what the Times is referring to as “eviscerating the boundaries between business and government” and something “without precedent in modern American history”?

Mr. Menton, earlier, you mentioned Nancy Pelosi. Can you fill us in? 

Critics have noted multiple times over the years where Pelosi or her husband seemed to have done a profitable stock trade just before some Congressional action. This piece from Yahoo Finance on January 8 notes that Pelosi’s stock portfolio was up 54% in 2024, which beat the performance of every hedge fund in the country. At the same time, a bill to restrict stock trading by congresspeople somehow never advanced while Pelosi was Speaker.

Francis Menton is not shy about sharing his views of the biggest political corruption incidents over the past few years:

• The multi-hundreds of billions of dollars of funding for the institutions of the Left from the government.
• The Censorship Industrial Complex put together by the Biden administration to suppress conservative speech.

As Mr. Menton notes, those things don’t seem to draw big front-page articles from the Times.

A Manhattan Contrarian fan brings up the frivolous/fictional crimes that played out in highly unfriendly partisan courtroom venues. Presidents LBJ, JC, BC, and JB – one big contrast with the supposed Trump “corruption” is that none of the others ever had to payout tens of millions in legal defense fees or face the financial threat of hundreds of millions in legal penalties/fines/damages and the physical threat of long prison terms from massive lawfare campaigns enacted against them by their political …”

The NYT never seemed interested in reporting on the Biden influence-peddling case. Without a grain of skepticism, it reported the Biden family press releases: “Joe and Hunter never discussed business”, “Joe never met Hunter’s clients”, “Joe never received one cent from Hunter’s business deals”.