Chinese entrepreneur invested $30 million in Trump’s crypto project after election
Chinese cryptocurrency entrepreneur Justin Sun invested $30 million in President-elect Donald Trump’s crypto project three weeks after the election, helping Trump make a potentially hefty profit.
Sun, who recently made headlines for buying, then eating, a $6 million banana art piece, is under investigation by the Securities and Exchange Commission on charges of fraud, market manipulation and other alleged violations. He announced the investment in Trump’s project Nov. 25 on X.
His investment offers a financial boost to the president-elect weeks before Trump is set to take office, and comes as Trump is considering whom to appoint to key financial posts in his administration – including to the SEC, which could drop the charges against Sun if the agency and its chairman desire.
The investment raises questions about how and whether America’s next president could be influenced through his business ventures, and whether the crypto project, World Liberty Financial, may provide a potential avenue for individuals to seek to curry Trump’s favor.
The crypto industry funneled millions into Trump’s presidential run, and its leaders have asked Trump to install new leaders at the SEC, Treasury Department and Internal Revenue Service, and to create a friendly environment for the industry. Trump is considering pro-crypto candidates for a variety of federal posts at the nation’s financial regulatory agencies, including the SEC, and his advisers have been consulting crypto executives about federal policy.
Trump has promised to make the United States the “crypto capital of the planet.” He has pledged to “defend the right to mine Bitcoin” and to keep crypto transactions “free from Government Surveillance and Control.”
World Liberty Financial was set up to funnel 75% of its net revenue to Trump or a company affiliated with the Trump family after meeting an initial $30 million in net revenue to be held in reserve.
World Liberty Financial was not close to reaching that $30 million before Sun’s investment, according to SEC filings. The platform opened with an offering of more than $288 million in October, and just more than $2.7 million worth of the token had been sold by Oct. 30, the filing shows. World Liberty Financial had sold more than $21 million in tokens before Sun’s investment, NBC News reported; his infusion bumped it to $51 million.
Sun’s investment meant World Liberty cleared the threshold of more than $30 million in net revenue, allowing Trump’s company to begin to collect the 75 percent profit on all additional revenue.
World Liberty bills itself as “inspired by” the president-elect, and Trump and his two older sons, Donald Trump Jr. and Eric Trump, are listed in its SEC filing as promoters of the company. His third son, Barron Trump, is listed as part of the team in World Liberty documentation, along with the other Trumps. A disclaimer says none is an employee or officer of the company.
Sun did not immediately respond to an emailed request for comment from the Washington Post, nor did World Liberty Financial.
Trump transition spokeswoman Karoline Leavitt, asked for comment about World Liberty Financial, did not address the project, saying, “President Trump removed himself from his multibillion-dollar real estate empire to run for office and forewent his government salary” when he was president four years ago.
Leavitt did not respond to a question from The Washington Post about whether Trump’s team has concerns about the potential for investors to seek to influence Trump through World Liberty Financial.
The SEC charged Sun with fraud in March 2023, accusing him of making an unregistered offer and sale of Tronix and BitTorrent, two crypto asset securities. He is also accused of manipulating the secondary market for Tronix and of orchestrating a scheme in which eight celebrities, including actress Lindsay Lohan, influencer-turned-boxer Jake Paul and musicians Akon and Ne-Yo, were paid to promote the assets without disclosing their compensation.
Six of the eight celebrities, including Lohan, Akon, Ne-Yo and Paul, agreed to pay a total of more than $400,000 in disgorgement, interest, and penalties to settle the charges, without admitting or denying the SEC’s findings.
When the complaint was filed, Sun said on X that he believed it lacked merit and accused the SEC of taking actions against “well-known players in the blockchain and crypto spaces.”
“We believe the complaint lacks merit, and in the meantime will continue building the most decentralized financial system,” he wrote.
The SEC alleged that Sun and his companies offered and sold Tronix and BitTorrent through unregistered programs and in unregistered monthly airdrops to investors. Unregistered offers and sales violate federal law. It also alleges that Sun tried to artificially inflate the trading volume of Tronix in the secondary market through an illegal process known as “wash trading,” which is meant to mislead investors into believing that the asset is being actively traded.
“This case demonstrates again the high risk investors face when crypto asset securities are offered and sold without proper disclosure,” SEC Chair Gary Gensler said in a statement at the time.
This past summer, Trump said he would “fire” Gensler and choose a new chairman. Whoever Trump nominates would require Senate confirmation. Trump chose hedge fund executive Scott Bessent as his pick for treasury secretary and has not made a decision on the IRS.
Sun was further accused of luring investors to make purchases through the star-studded promotional campaign in which celebrities tweeted about the assets but didn’t say they had been paid for the tweets.
“Sun and others used an age-old playbook to mislead and harm investors by first offering securities without complying with registration and disclosure requirements and then manipulating the market for those very securities,” Gurbir S. Grewal, director of the SEC’s enforcement division, said in the SEC’s statement.