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Donald Trump’s family appears to be preparing yet another money-raising ‘crypto’ project, even as memecoins associated with his name rug-pulled their customers.
But first, on August 5, five U.S. senators and three members of the House of Representatives sent a letter to Rostin Behnam, chairman of the Commodity Futures Trading Commission (CFTC). The eight Democratic pols wrote in support of a proposed rule change that would prohibit “event contracts concerning the outcome of U.S. elections.”
The proposal would prohibit event contracts—aka betting on the outcome of events—based on “gaming, war, terrorism, assassination, and activity that is unlawful under any Federal or State law.” The CFTC’s proposal defines ‘gaming’ as including “the outcome of a political contest.”
The Dems’ letter claims that election wagers “change the motivations behind each vote, replacing political convictions with financial calculations.”
Such bets “do not serve the economic purpose of futures markets.” Moreover, “allowing billionaires to wager extraordinary bets while simultaneously contributing to a specific candidate or party, and political insiders to bet on elections using non-public information, will further degrade public trust in the electoral process.”
There are several prediction markets currently taking wagers on the 2024 election, including the New Zealand-based PredictIt, which butted heads with the CFTC a few years ago in a case that remains unresolved.
And then there’s the New York-based Polymarket, the Ethereum-based platform that paid a $1.4 million penalty to the CFTC in January 2022 for offering unauthorized binary options contracts and failing to register with the regulator.
The U.S. 2024 election is currently the unquestioned top event on Polymarket, with over half-a-billion dollars wagered on the outcome. Trump used to hold a decisive edge over his opponent, Kamala Harris, on Polymarket, but Harris narrowed that gap significantly in recent weeks, and the two have been battling for a very small lead over the other in the past few days.
Prediction markets have been celebrated as a more accurate barometer than opinion polls and surveys, based on the fact that election bettors have financial skin in the game. But they’re not infallible.
Just four days before Harris selected Tim Walz as her running mate, Polymarket bettors—who’d wagered $125 million on this market—gave Minnesota’s governor a mere 4% shot at getting the nod. On the day before the announcement, when scuttlebutt had the race coming down to either Walz or Pennsylvania Gov. Josh Shapiro, Walz’s odds had only improved to 30%.
An aggregation of betting odds across four different prediction markets currently shows Harris with a two- or three-point edge over Trump. While it’s hardly an insurmountable lead, it’s also a scenario the Trump camp couldn’t have conceived when incumbent Joe Biden was still his opponent. (More mainstream surveys show an even-wider Harris advantage.)
Perhaps that explains why Trump has flip-flopped so hard on his previous hostility towards all things ‘crypto.’ Facing the very real possibility that he won’t be returning to the White House—but might be returning to federal court to explain why he kept all those classified documents at his Florida crib—Trump will need all the cash he can get to pay lawyers to ensure he remains a free man.
There’s gold in them thar blockchains
Trump recently announced he will participate in an online interview with Elon Musk on Musk’s X/Twitter platform next Monday the 12th of August. Given the mercurial Musk’s on-again/off-again ‘crypto’ fandom, the subject is likely to get some airtime in between all the conspiracy theories and mutual backscratching.
Trump’s ‘crypto’ about-face was on full display at last month’s BTC Nashville confab, where he gave a speech that told the audience whatever they wanted to hear (although Trump’s condescension was beyond palpable).
Ahead of his speech, Trump held a pricey fundraiser that charged individuals $844,600 to sit at a roundtable and kibbitz with the candidate. The event reportedly raised $25 million for Trump’s campaign, or for any other purpose Trump deems appropriate.
Trump then launched a ‘super limited’ line of fugly Bitcoin Sneakers at $499 per pair. The website pimping these pumped-up kicks explicitly states that the sale “has nothing to do with any political campaign.” The 1,000 available pairs sold out quickly and have been offered for as much as $2,500 on eBay.
Never one to turn down opportunities to line his pockets, Trump (the candidate) previously released three lucrative series of non-fungible tokens (NFT) and recently claimed that he was prepping a fourth set “because the people want me to do one.”
You ain’t seen nothing yet
But it seems the Trump family’s crypto grift is only getting started. On August 6, Donald’s son Eric tweeted that he has “truly fallen in love with Crypto / DeFi. Stay tuned for a big announcement…” The following day, Donald Jr. tweeted that “we’re about to shake up the crypto worldwith [sic] something HUGE. Decentralized finance is the future—don’t get left behind.”
Trump Jr. added the hashtag #BeDeFiant, the only other previous appearance of which came on August 6 by Steve Witkoff, founder of the Witkoff Group, a real estate developer/investor. Witkoff claimed: “We’re on the verge of something game-changing in Crypto and DeFi. Bringing financial power and freedom back to the people—get ready.”
Steve’s tweet was retweeted by his son Zach, a tech investor in Miami who follows a number of right-wing figures. Both Witkoffs appeared at last month’s Republican National Convention.
Both Witkoffs also follow Chase Hero, co-founder of Subify, an Only Fans knockoff that allows ‘creators’ to flog products to their followers. Subify’s Puerto Rico mailing address is the same as AMG Software Solutions, an educational software firm.
Last month, AMG applied for several trademarks, including the phrases ‘Be Defiant’ and ‘World Liberty Financial.’ The former is listed as “providing financial information in the field of cryptocurrency” while the latter is listed as “providing financial information in the field of decentralized finance (DeFi).” A third application for ‘World Liberty’ has a logo featuring an eagle.
The applications were filed by attorney Alexander Golubitsky. An attorney by the same name was formerly the chief legal officer at Umami Labs, a DeFi firm that collapsed in February 2023 amidst a sea of accusations among its principals.
So, is the Trump’s new scheme a ‘crypto’ educational platform? Or just an excuse to release another pointless Trump/MAGA-themed memecoin? Because the last one did so well…
Ready. Fire. Aim.
On August 6, the fiat value of TrumpCoin (DJT) effectively dropped to zero, less than two months after its debut. The plunge came when a wallet holding roughly one-fifth of all DJT in existence abruptly sold the lot and other holders quickly raced for the exits before they too were liquidated.
DJT was just one of countless politically-themed memcoins to have launched this year as election fever took hold. But early on, DJT was rumored to be affiliated with the Trump family, in particular Trump’s 18-year-old son Barron. These rumors were fueled by the fact that no one in the family seemed all that eager in making a clear statement disavowing any connection to the token.
Convicted securities fraudster Martin ‘Pharma Bro’ Shkreli, who tipped his involvement in DJT early on and suggested that Barron had launched the token with his father’s approval, was eventually exposed as the individual behind the token’s creation. And yet Shkreli continues to claim that DJT was “made by barron, a third guy and myself,” while saying the digital wallet dumping DJT “looks like barron, trying to confirm.”
On August 8, as online chatter grew about the Trumps’ mystery project and some other seemingly Trump-adjacent tokens launched, Eric Trump tweeted a warning: “Beware of fake tokens! The only official Trump project has NOT been announced! You will hear it here first.”
Around the same time, Don Jr. tweeted “I love how much the crypto community is embracing Trump … but beware of fake tokens claiming to be part of the Trump project. The only official project will be announced directly by us, and it will be fair for everyone.”
Interestingly, Eric’s tweet was retweeted by Shkreli, who also retweeted several of the Trump brothers’ other crypto-related tweets, with Shkreli adding skeptical phrases like ‘wat’ and ‘que’. Shkreli also tweeted “this seems possible/right” to another poster who claimed the brothers “really forced Barron out of $DJT to launch their own shitcoin instead.”
We’ll wrap this up by noting that the X/Twitter personality known as Pledditor has thoughtfully put together a ‘memecoin bingo card’ that will help us endure the Trump family’s latest crypto-related cash-hoovering plan. And hey, only three months to November!
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