(WASHINGTON) — President Donald Trump’s cryptocurrency firm, World Liberty Financial, sold a $500 million stake to a member of the Emirati royal family shortly before his inauguration last January, The Wall Street Journal reported on Saturday, sparking concerns over a potential conflict of interest.
According to the Journal, which reviewed undisclosed corporate documents, a firm associated with Sheikh Tahnoon bin Zayed Al Nahyan, an Abu Dhabi royal who operates an enormous state investment fund, purchased a 49% stake in World Liberty, which is co-owned by Middle East envoy Steve Witkoff and his family, just four days before the Trump administration swept into office.
Months later, the Trump administration agreed to supply the UAE with highly coveted American-made AI chips despite the prior administration’s concern that they may fall into the hands of the Chinese.
David Wachsman, a spokesperson for World Liberty Financial, acknowledged the existence of the deal in a statement to ABC News, but insisted that “neither President Trump nor Steve Witkoff had any involvement whatsoever in this transaction” and that “any claim that this deal had anything to do with the Administration’s actions on chips is 100% false.”
“We made the deal in question because we strongly believe that it was what was best for our company as we continue to grow. The idea that, when raising capital, a privately-held American company should be held to some unique standard that no other similar company would be held is both ridiculous and un-American,” the statement continued.
David Warrington, the White House counsel, told ABC News in a statement that “the President has no involvement in business deals that would implicate his constitutional responsibilities,” and that “President Trump performs his constitutional duties in an ethically sound manner and to suggest so otherwise is either ill-informed or malicious.”
But the Journal’s report adds yet another wrinkle to the U.S. decision to sell highly coveted advanced chips to the Emiratis.
As ABC News previously reported, shortly before the chips deal was announced, a UAE-backed investment firm called MGX announced last May that it would use a digital token minted by World Liberty Financial to finance a $2 billion investment in a crypto exchange Binance, a major boon for the firm.
Shiekh Tahnoon, who is the brother of the UAE’s president, also serves as MGX’s chairman.
The Biden administration declined to provide the UAE with the chips, which power some of the most sophisticated weapons on the planet, for fear they might be redirected into China.
Peter Wildeford, the head of policy at the AI Policy Network, a nonpartisan advocacy group, warned that could close the U.S.’s advantage in the AI race and compromise American security.
“If China gets their hands on these chips at scale, they would be able to launch cyberattacks against the U.S., they could build autonomous weapons that could find and sink our Navy ships — they could close the military technology gap that’s currently keeping us safe,” he said.
World Liberty has emerged as perhaps the most lucrative of the Trump family’s various business ventures, either in cryptocurrency or real estate. ABC News reported last year that the Trump family secured a roughly $5 billion windfall when trading of World Liberty’s digital token opened.
According to the Journal, Shiekh Tahnoon agreed to pay half of his investment in World Liberty up front. Based on the ownership structure of the company at the time, that meant a payment of as much as $187 million into the Trump family’s coffers on the eve of his return to office.
Ethics experts said the concept of a foreign government official secretly directing hundreds of millions of dollars to a company owned in part by the president has no known precedent — and raises a host of ethical and national security concerns.
“Maybe the President would have reached the same decision over the transfer of high techn [chips] to UAE if he wasn’t also getting money from them,” said Robert Weissman, the co-president of the advocacy group Public Citizen. “But we’ve got no way to know that, and we do know there was a lot of opposition inside the government to do exactly what he has OK’d.”
White House spokeswoman Anna Kelly maintained that the president “only acts in the best interests of the American public,” and said that no conflict of interest exists in part because the president’s assets are held in a blind trust managed by his children. Typically, a blind trust would operate with an independent trustee.
“President Trump’s assets are in a trust managed by his children,” Kelly added. “There are no conflicts of interest.”
The Trump Organization did not immediately respond to a request for comment.
Congressional Democrats leapt at new details in the report, characterizing the transaction as further evidence of alleged pay-for-play. Sen. Chris Murphy, D-Conn., alleged “mind blowing corruption,” in a post to X.
Sen. Elizabeth Warren, D-Mass., issued a statement calling the deal “corruption, plain and simple.”
“Foreign countries are bribing our president to sell out the American people,” Sen. Chris Van Hollen, D-Md., claimed in a post to X.
Shortly before the chips deal was announced last May, a UAE-backed investment firm called MGX said it would use a digital token minted by World Liberty Financial to finance a $2 billion investment in a crypto exchange Binance. Tahnoon also serves as MGX’s chairman.
MGX is also one of the few companies with a major ownership stake in the new TikTok U.S. joint venture, with a 15% stake in the new entity.
ABC News’ Selina Wang contributed to this report.
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