Trump family's crypto venture sparks SEC inquiry

U.S. lawmakers have called on the Securities and Exchange Commission (SEC) to provide transparency regarding World Liberty Financial (CRYPTO:WLFI), a cryptocurrency firm backed by President Donald Trump's family.

The request comes amid concerns about potential conflicts of interest and how these might influence regulatory decisions in the crypto sector.

In a letter to acting SEC Chair Mark Uyeda, Senator Elizabeth Warren and Representative Maxine Waters expressed concerns that the Trump family's financial stake in World Liberty Financial could impact the SEC's impartiality.

They noted that this conflict of interest might lead to favorable treatment for cryptocurrency interests benefiting the President's family, undermining the SEC's mission to protect investors and maintain fair markets.

World Liberty Financial has raised over $550 million through token sales, with the Trump family holding a significant stake in the venture.

The company's governance structure has been criticised for being overly centralised, contrary to typical decentralised finance (DeFi) principles.

Critics argue that the Trump family's control could lead to regulatory favoritism, particularly given the family's substantial financial interests in the crypto sector.

The lawmakers' request for transparency follows a series of crypto-related initiatives by the Trump family, including investments in Bitcoin mining and the launch of a stablecoin.

These activities have raised questions about the potential for regulatory capture and conflicts of interest within the administration.

As the SEC faces scrutiny over its handling of crypto cases, the nomination of Paul Atkins as the next SEC chair is pending Senate approval.

Atkins' appointment could further shape the regulatory landscape for cryptocurrencies, potentially impacting how firms like World Liberty Financial are treated.

In their letter, Warren and Waters emphasised that Americans deserve to know whether financial markets are being regulated impartially or if decisions are skewed to benefit the President's family interests.

They urged the SEC to preserve records related to World Liberty Financial and communications with the Trump family to ensure accountability.