There has been a great deal of controversy in Washington over Trump crypto deals. Democrats in the Senate are vying against cryptocurrency legislation that would enrich the former president’s family business.

As recently revealed, World Liberty Financial, a crypto firm with ties to Trump, also obtained a deal worth $2 billion in deposits with an Emirati fund backed by the government of Abu Dhabi. 

Key-Takeaways:

• Democrats in the Senate have already started opposing the GENIUS Act because much of the financial benefit would go to Trump’s family. The calls for an ethics investigation for foreign influence and conflict of interest is the issue.
• Support from both parties for regulation of stablecoins is waning, including from Republican Senator Lummis, who voiced concern over Trump’s increasing involvement in the industry, a potential setback on one of the industry’s key legislative goals.

Senate Democrats Urge Opposition To GENIUS Act

Bipartisan legislation that once saw passage possibilities is now facing major roadblocks. The controversy revolves around Trump Crypto Deals.

The resistance against the GENIUS Act, which is attempting to regulate stablecoins, is growing. Earlier, Senate Democrats, who had once backed it, had turned away.

Democrats expressed serious concerns at a closed-door meeting led by Senator Chuck Schumer. That’s a selling of influence, a conflict of interest, just a massive form of corruption we haven’t seen put on display from people on the Trump list,” Senator Jeff Merkley said of the Trump Crypto Deals.

These were echoed by senator Elizabeth Warren, who warned that the legislation will “make it easier for the president and his family to line their own pockets.” The comments by her reflect growing unease among Senate Democrats.

The pushback has been significant. Nine Democrats, including four who voted for the measure in committee, now want major changes.

But this development is a serious danger to the bill’s future. That could scuttle one of the crypto industry’s most important legislative goals.

The center of the Trump Crypto Deals controversy surrounds World Liberty Financial. Recently, the company, which was founded by Trump and his sons, launched a stablecoin called USD1.

The timing has become a troubling sign in Washington. News of the stablecoin comes on the heels of the Senate Banking Committee grooming the GENIUS Act toward an initial vote.

The stablecoin issuers are like the banks. Buyers deposit funds in them and they invest those to earn returns.

The $2 billion deal with an Abu Dhabi backed firm sends Trump led business major funds. Speeding this up has become a serious ethical and national security concern.

They have called for an investigation, Senators Merkley and Warren. They say there is a “startling degree of foreign influence and the possibility of a quid pro quo.”

Broader Industry and Legislative Implications

Trump crypto deals are not particularly partisan. The wider cryptocurrency industry is now affected.

A Democrat from California, Representative Sam Liccardo, said industry leaders were expressing concern at the possibility. There is deep discomfort about the fact that Trump has wrapped this industry into a kleptocratic scheme managed by his sons, he said.

Republican Senator Cynthia Lummis of Wyoming, a crypto supporter, also expressed concern. Though her political support of the president is known, she said the Trump Crypto Deals ‘gave her pause.’

The fallout is significant. The legislation is threatened with derailment by crypto firms, which have lavished over $130 million on congressional candidates for the 2024 election.

White House Defense

Despite the controversy, the Trump administration continues to support the crypto ventures. Trump’s assets are held in a trust managed by his children, and there’s no conflict, White House spokeswoman Anna Kelly said.

But Trump still benefits financially from these investments. “President Trump is committed to ensuring America is the crypto capital of the world and leading in our digital financial technology,” Kelly said.

Conclusion

Legislation on Trump crypto deals continues to stall. Only a few weeks back, Trump promoted a new cryptocurrency called $Trump on Truth Social, which reportedly saw him generate over $100 million in fees.

Those concerns about presidential business ties and financial regulation are high as Congress debates the issue. It may change the U.S. crypto rules.