← Post Reports
Post Reports
The cryptocurrency that buys access to Trump
00:28:36
Why President Donald Trump minted his own cryptocurrency, and the foreign investors pouring money into his meme coin.
Loading summary
Transcript56 lines
- [00:00]
Wix Advertiser
It's time to turn your daydream into your dream job. Wix gives you the power to turn your passion into a moneymaker with a website that fits your unique vision and drives you towards your goals. Let your ideas flow with AI tools that guide you but give you full control and flexibility. Manage your business from one dashboard and keep it growing with built in marketing features. Get everything you need to turn your part time passion into a full time business. Go to wix.com.
- [00:31]
Colby Ikowicz
Later this week. On Thursday, President Donald Trump is hosting a lavish exclusive dinner at his private golf club outside of Washington D.C. now Trump hosting fancy dinners. That's not so unusual. What is unusual is how to get on the guest list.
- [00:47]
Drew Harwell
To get an invite, you have to buy a bunch of Trump meme coins, like millions of dollars in Trump meme coins to qualify.
- [00:55]
Colby Ikowicz
That's technology reporter Drew Harwell. He's been covering the complex world of crypto and how Trump has infiltrated that world by minting his own currency called a meme coin. From the newsroom of the Washington Post, this is Post Reports. I'm Colby IKOWICZ. It's Tuesday, May 20th. Today I talk with Drew about Trump's meme coin, the money the Trump Organization has made off of it, and the foreign investors who've bought access to the President by investing in his cryptocurrency. Hi, Drew. Thanks so much for being here.
- [01:35]
Drew Harwell
Yeah, thanks for having me.
- [01:37]
Colby Ikowicz
So, Drew, I'm going to plead total ignorance. What's a meme coin?
- [01:44]
Drew Harwell
Yeah, a meme coin. I know, it is a funny word. So we know bitcoins, right? They're cryptocurrencies, which just mean a bit of code that has some value on the Internet. Meme coins are kind of a spin off of that. You take the meme part, which is, you know, this viral Internet joke, Internet trend, and you put a crypto component to it. So basically, any joke that has taken off on the Internet in the last several years can become a meme coin. And people can create it and they can sell it and people can speculate on them and trade them. And so our president has created a Trump coin coin, and that's exactly what people are trading. Now.
- [02:29]
Colby Ikowicz
Is it tied to any specific meme or is it just a coin of. I'm, I'm, I'm trying to wrap my head around what it actually is. So what exactly is the president selling?
- [02:40]
Drew Harwell
So cryptocurrency is like a digital form of money, and instead of a bank or a financial institution tracking it, every transaction, you Make. Every time you get this digital money, it's recorded in this big public log known as the blockchain. And when you get a cryptocurrency, you get basically just a long string of code that means nothing to you, but you save it in something called a wallet. It's a digital place that you store all of your cryptocurrencies and that you can access whenever you want to buy goods or services, trade your crypto. So it's this new form of digital money. So meme coins are just like a tendril off this big cryptocurrency currency, octopus. And there's not really any value to them. You can't buy things with them. There's no store that accepts meme coins for the most part. You basically just buy them because you think the joke is funny and you think maybe the price will go up or you believe in the people selling them. And so people are buying these Trump coins, but they don't really amount to anything. There's no underlying value. It's just you're betting on the Trump brand.
- [03:58]
Colby Ikowicz
Okay, Drew, I'm trying to wrap my head around all of this. So you're saying there's no underlying value. So how do people make money? What. What then determines what these coins are worth?
- [04:10]
Drew Harwell
Yeah. So all of this is why crypto is the wild west. Right? There's no. Yeah, central financial authority. There's really not a lot of rules or regulations around crypto. And so the value of meme coins and cryptocurrencies all just come off of what you can trade it for, what you can sell it for to someone else. The prices of these meme coins swing wildly in value. There's a lot of scams in cryptocurrency, and to really trade well on them requires not just, you know, round the clock devotion to watching crypto markets, but also sometimes having internal inside information for when a coin is going to launch and how it's going to trade. So it's this really risky business that the President has now saddled himself with.
- [05:00]
Colby Ikowicz
Okay, so how did Trump even end up getting into this business? How did it come to be that Trump would make and sell his own meme coins?
- [05:11]
Drew Harwell
Yeah. So just before taking office in January, Trump announced on Truth Social that he was launching this Trump coin, which is, you know, a meme coin, and it's known by its name, which is Dollar Sign Trump. And, you know, before this, you know, years ago, Trump had actually said that he thought bitcoin was basically a scam. He thought these cryptocurrencies Their values were based on thin air. Do you ever dabble in bitcoin or cryptos?
- [05:42]
Donald Trump
I don't. I like the currency of the United States. I think it's, you know, I think the others are potentially a disaster waiting to happen.
- [05:51]
Drew Harwell
And yet in the last year or two, he'd actually gotten a lot of support from crypto people. Crypto people thought that the Biden administration had been too tough on cryptocurrencies. They were passing or proposing regulations they thought would be bad for crypto because the Biden Sec just, you know, acknowledged that there were a lot of scams in this industry. So a lot of those people showed support to Trump and Trump showed support back during the campaign. He went to bitcoin related events.
- [06:21]
Donald Trump
This afternoon, I'm laying out my plan to ensure that the United States will be the crypto capital of the planet and the bitcoin superpower of the world. And we'll get it done.
- [06:32]
Drew Harwell
He went to a bitcoin bar in New York during, during the campaign to really like, glad hand with crypto people. Yeah, this is a crypto burger.
- [06:45]
Donald Trump
You should name them. Name a bitcoin and a crypto.
- [06:48]
Drew Harwell
So an affiliate of the Trump family business, the Trump Organization, teamed up with this other company that not a lot is known about, called Fight Fight Fight. It's run by a Trump friend named Bill Zanker who has been involved in Trump businesses in the past. And they named it Fight Fight Fight after, you know, what Trump said after the attempted assassination in Butler, Pennsylvania. So this is basically a Trump enterprise through and through. And they just decided, hey, we're going to start selling this meme coin, if you like me, come in and buy it and trade it and you can get profit out of it maybe. And either way, the Trump business stands to profit from people giving their money into this enterprise.
- [07:31]
Colby Ikowicz
So when the coin is first launched, how much does it cost to buy one?
- [07:35]
Drew Harwell
So at first, you know, as with meme coins, they start from basically zero, and a lot of people pour their money into them. And the price of it went to about $75 a CO coin right around the time of Trump's inauguration. It hung out there for a really short amount of time. And very quickly after his inauguration, it plunged. It fell from 75 to, you know, around 10 to $15. And that's where it is, you know, today, five months later. So this is actually pretty standard for meme coins. This happens a lot. I mean, memes, you can tell by the name, they're all about what the funny joke of the day is, a lot of them go super high really quickly. Everybody makes their money and sells and gets out of it. So that's kind of what we've seen with the Trump coin. It peaked really quickly, but over time the value has plunged, you know, more than 85%.
- [08:31]
Colby Ikowicz
So does that mean then that the people who purchase the meme coin lost money on their investment?
- [08:38]
Drew Harwell
Yeah, a lot of them have. Actually, we looked into this and because bitcoins and meme coins are traded on the blockchain and and because a lot of that data is public, we were able to analyze it in a pretty big at scale way. And so we found that for the people who were, we would call them crypto novices, basically they bought their Trump coin by going onto the Trump Coin Project's website. They clicked the big buy now button, they gave their debit card and they got a Trump coin in response. And what we found is that 67,000 wallets connected to people of these new or small time investors bet on Trump's meme coin and virtually all of them have lost money. 80% of them have seen the value of their meme coin stakes plunge since that time because it peaked so quickly around the time of the inauguration and has plunged ever since.
- [09:42]
Colby Ikowicz
I have to imagine, Drew, like you said, that a lot of the people that bought the Trump meme coin were not well versed in cryptocurrency and were buying it because it was something attached to Trump and because Trump was telling them to. Is that what you've understood?
- [09:59]
Drew Harwell
Totally, yeah. I mean, you have to think about crypto and meme coins. They're this niche, right? There are a lot of people who get into it, kind of like day traders on the stock market. And they're really involved and they, you know, they make money, they lose money, but they're, they're experienced at it. That's kind of what you see with most meme coins. But with the Trump meme coin, you have the President talking about it often going online, sharing links to it. And you know, he's somebody who hundreds of millions of people see his posts every day. And he has a huge base of political support. So you really did see a lot of newbies kind of get into this market not really knowing what was going on and just kind of believing in Trump by default. Right. Seeing him as this skilled businessman who of course, if he got involved with it, it be a success. So you have seen those people really lose money from betting on him and lose money by trying to show him support and show him loyalty.
- [10:57]
Colby Ikowicz
But how has Trump done. How does Trump make money off of this, even though the value of the meme coin has gone down? Has he made out well financially from this?
- [11:08]
Drew Harwell
Yeah, he's made a lot of money off of this. So it's not just Trump, but this Trump Organization affiliate, and it's this other company, Fight, Fight, Fight and Trump Partners all together. One, they have a lot of the coins, so they've been able to sell a lot of the coins. They've sold something like $300 million in coins to other buyers. So that's a lot of money right there. They also make money no matter what the price of it is, because they can charge transaction fees. Everybody who buys a Trump coin through them has to pay a 1% transaction fee, which doesn't sound like a lot, but that has added up to 40 million in fees just alone. And that's in. That's in US Dollars, right? That's not even in crypto. That's money that goes straight into their. Their pockets just from. From being involved with this. So unlike real estate, right? Unlike hotel towers and golf courses, you can make meme coins from your desk, right? I mean, this is something where they didn't have to really build anything. They didn't have to make some big investment, do permits, build any. They just made this on their own. And. And through the force of Trump's support and Trump's attention, they've been able to make millions.
- [12:27]
Colby Ikowicz
After the break, the crypto investors who bought up enough of Trump's Meme coin to get an invite to an intimate dinner party with the President. We'll be right back.
- [12:46]
Tom Sytsima
My name is Tom Sytsima, and I am the food critic for the Washington Post. I think a lot of great restaurant meals are like great books, films, or concerts. You don't necessarily need them to live. But don't they make life more worth living? I see myself as sort of a reader advocate, going in there, spending the Post money, coming back and giving you the green light, yield sign or a stop sign. I like to be seen as sort of the best friend who happens to eat out a lot more than they do. I eat in about 10 restaurants a week, and I like creating memories for people and helping them create memories, whether those are first date, a 50th anniversary, grandma's 90th birthday, if you have special needs, whether they're dietary or otherwise. When you subscribe to the Washington Post, you support this kind of journalism. Learn more at subscribe.washingtonpost.com. i'm Tom Sytsima and I'm one of the people behind the post.
- [13:46]
Wix Advertiser
It's time to turn your daydream into your dream job. Wix gives you the power to turn your passion into a moneymaker with a website that fits your unique vision and drives you towards your goals. Let your ideas flow with AI tools that guide you but give you full control and flexibility. Manage your business from one dashboard and keep it growing with built in marketing features. Get everything you need to turn your part time passion into a full time business. Go to wix.com.
- [14:17]
Lowe's Advertiser
Kick off summer with Memorial Day savings at Lowe's right now get five Scott's Naturescapes one and a half cubic foot mulch bags for just $10 plus get up to 40% off select major appliances and save an extra $50 on every $500 you spend on select major appliances. $396 or more. Lowes we help you save valid through 528 mold shopper excludes Alaska and Hawaii. Selection varies by location while supplies last. See Lowes.com for more details.
- [14:48]
Colby Ikowicz
So Drew, we talked at the top of the show about this meme coin dinner that Trump is throwing. How does that play into all of this? What's the goal of this dinner?
- [14:59]
Drew Harwell
Yeah, so a couple weeks ago, the Trump meme coin price had really been sagging pretty low and the Trump team running this project, they came out and said, okay, we're going to do a contest. Whoever has bought the most Trump meme coins, we're going to invite you to this night to remember. You're going to get the special seat at a dinner at the Trump National Golf Club outside Washington. The President is going to be there, we're going to be talking about crypto regulation and what the government's going to be doing about crypto in the future and all of these things that are important to you as somebody who has a lot of crypto money. And it's going to be by invitation only, just for the people who have again given the Trump enterprise money. And all of this whole project has been unusual, but here you had the President's company saying, we're going to give value to this meme coin because we're going to tie it to access to the President. If you want to talk to the leader of the free world about, you know, the regulations that could make or break your whole investment in crypto, you're going to want to give the President's company money because you want to see it at the table. And so after they announced that there was a huge flood of money into the Trump meme coin of people wanting to be involved in this conversation. And to put a real fine point on it, the Trump people put out this online leaderboard, which is literally a ranking of who has the most Trump meme coin at any moment. So it was not only that people were buying access to the President. They could see at what level they had bought more access than the next person over. So it was extremely unusual, and yet it was very profitable for the president. We saw this money flood in, and now, you know, the dinner is coming up, and a lot of these meme coin people who have poured money into it, they're. They're coming to Washington, and they're excited to see the President. They're excited to talk about crypto in this private setting. And, yeah, it's all. It's all playing out right before our eyes.
- [17:16]
Colby Ikowicz
Drew, this seems incredibly problematic, and that's just to put it mildly. My mind is kind of blown that this is even allowed. I mean, is this allowed?
- [17:25]
Drew Harwell
Yeah. So, yes. Asterisk, like, so you'd probably guess that the founding fathers had no thoughts on meme coins.
- [17:35]
Colby Ikowicz
Right.
- [17:36]
Drew Harwell
All of this is so new that there's nothing constitutional in there except for things like the emoluments clause. Right. These old kind of, you know, doctrines that we've talked about in the Trump era for many years at this point that go to the heart of what can the President be given by somebody who's either in the country hoping to kind of bend his ear, or somebody who's out of the country. Right. Trying to affect American policy? I mean, the emoluments clause of the Constitution basically says, you know, the President can't take these big gifts from foreign actors because of all the possible conflicts of interest there. Right. We want the President to be making decisions based off the good of America, not the good of his businesses and how much money he makes. So when it comes to crypto, again, we just don't have a lot of regulations around it. Even crypto proponents have said we need more rules to govern things like this because this shouldn't be allowed. But at the point there's no law that says Trump can't be doing this, and Trump's defenders have said, what's the difference between this and a campaign dinner, a fundraiser? I think the problem that critics have brought up is that it creates the specter of a pay to play deal. Right. If you're wealthy and you want Trump to make rules how you want to make them, you're going to have to pay in to get that access. But, you know, also, I think if we can really play it out even more tangibly is like, if you're a foreign government who doesn't like Trump's trade policy, doesn't like tariffs, just wants a better place in, you know, the American infrastructure, why wouldn't you invest. Right. And buy a bunch of meme coins and get Trump's ear? That would potentially give you an advantage. Right. Or if you're a criminal and you have a lot of maybe ill gotten gains, why not invest in Trump meme coins so you can be at the table and ask him yourself for a pardon. You just see all of these ways this could be misused, and yet this dinner is still about to take place.
- [19:46]
Colby Ikowicz
So there's really no law that prohibits the President of the United States from selling personal access to him and to the White House. This feels like something that would be the subject of congressional investigations and would have people's hair on fire no matter what what side of the aisle you're on.
- [20:09]
Drew Harwell
Yeah. So you are starting to hear from lawmakers. You have people like Senator Chris Murphy, who's a Democrat from Connecticut. He's been speaking out a lot about this. He said this whole meme coin thing is the most corrupt thing a president has ever done. Trump's crypto coins are the biggest scandal in the history of the presidency because it's corruption at scale. There's also been some legislation that's been proposed by Senator Jeff Merkley, a Democrat from Oregon, and a few others that would ban top government officials, not just the president, but, you know, members of Congress, high level administration officials at different agencies from benefiting from crypto assets, meme coins, stuff like that. And it's not just a Democrat thing either. There are also Republicans who are really raising concerns about this. There's a senator in Wyoming who's a Republican named Cynthia Lummis who told us she's actually a pretty big crypto proponent. She feels like we should have more laws to allow crypto to flourish. But she has even said, you know, this is my president. But this event gives me pause. She feels like this is ammunition for people who feel like crypto is all sham and scams to say, okay, here's a way where again, it's being misused by a government official trying to make bank off of it.
- [21:27]
Colby Ikowicz
Drew. I think back to the Biden administration and how Republicans were constantly calling Biden corrupt and calling his son's involvements in various international businesses corrupt. And so I Wonder, like, how Republicans justify this, and more so than that, like, how is the White House justifying this?
- [21:50]
Drew Harwell
Yeah, so the White House has been very clear that they are not involved with this. But they've also made the point that there's no conflict of interest here, in their words, because this, this Trump Organization affiliate is in a trust overseen by Trump's sons, Don Trump Jr. And Eric Trump. So they're basically saying that this is not a Trump thing, this is a Trump Jr. Thing. And that absolves any potential conflict of interest. And Trump himself, when he's been asked about this on NBC News, he said.
- [22:25]
Donald Trump
I haven't even looked. I'll tell you what, look, if I own stock in something and I do a good job and the stock market goes up, I guess I'm profiting basically.
- [22:36]
Drew Harwell
Just trying to dismiss it as a concern.
- [22:38]
Colby Ikowicz
So, Drew, I want to circle back to this dinner that Trump is holding in just a few days. Do we know anything about the people who have made these massive coin purchases and are now going to be spending time with the President?
- [22:52]
Drew Harwell
So the leaderboard that ranks these meme Coin investors doesn't get a, a lot of info about who they are. Crypto is kind of just by default, pretty anonymous. You have crypto wallets that are just big gobbledygook strings of code that don't have people's names attached to them. And on the leaderboard, people can basically give like a three or four letter code to indicate who it is. Kind of like an arcade game of like trying to get the best score. It's basically exactly like that. But even from that that a little bit of information, we have been able to glean some details of who will be invited. I think one of the more interesting wallets on the list is a wallet called Sun S U N. And it's registered to this crypto exchange founded in China called htx, that their advisory board includes this crypto billionaire named Justin Sun. Justin sun is known for being investigated by the SEC on charges of fraud. Last year, after those charges came out, he actually invested 30 million into another Trump crypto venture called World Liberty Financial. Very soon after, the SEC asked a federal judge to halt the case against Justin sun and basically, you know, put a freeze on this bigger investigation into Justin Sun. So it's entirely possible that Justin sun also gave a lot of money to the meme Coin crypto venture of Trump. Maybe as a thank you, but Justin sun hasn't really been talking and we just sort of have some individual clues.
- [24:36]
Colby Ikowicz
That point that Way interesting. So it's a chancel he'll be at the dinner, but we can't confirm that.
- [24:41]
Drew Harwell
Yeah. So there are suspicions, but nothing confirmed just yet. And of the many other names on the leaderboard, there's one other kind of interesting piece of data, which is that 19 of the top 25 are probably foreign investors. You can kind of figure that out because you can tell where they got their crypto from. And most of them got their crypto from these exchanges like Binance that reject customers in the US So you have to expect that there's going to be a lot of international rich crypto people in the room with President Trump when he has dinner with him on Thursday.
- [25:21]
Colby Ikowicz
So these investors that have ponied up millions of dollars to go to this dinner, what do you think they want to say to the president?
- [25:28]
Drew Harwell
So there's a couple things. One is these are people with a lot of money in crypto. They feel like this is the best chance they may ever get to shape how the government treats their industry. And they have said they don't want to let this moment pass them by. They, they want to, to not enforce too many regulations to overwhelm crypto. And basically they just want, you know, a hands off environment for them to keep doing what they're doing. So the couple of people I've been able to talk to have said I never expected to be able to talk to the president. And when I get this chance, I'm going to hopefully let him know that crypto is behind you. And we want to make sure that crypto doesn't go away. And here are the policies and the things you can help support as the leader of the free world to keep this industry going.
- [26:26]
Colby Ikowicz
Yeah, I mean, Drew, what can we kind of foresee about what Trump's policy positions are going to be on cryptocurrency, like what the US Government's relationship to this currency will be at least as long as Trump is president.
- [26:43]
Drew Harwell
Yeah. So I pick up a couple things from this. One is that you have this industry that is full of risks, is full of scammers. You see an industry that, that traditionally we would have said, let's put some regulation on this. Right. People are losing money. Let's get this into a place where we as a society and as a government feel like it's in a productive place and not victimizing people. And yet when you look at events like this and you see Trump not only kind of supporting the policies that allowed it to happen, but benefiting from the people who are involved in this industry, taking money from these people, that's an indicator that the things that might be best for the general public and for Americans when it comes to crypto may not always be the same as what's best for Trump. This industry is not going away. It's only gotten bigger. More people have gotten involved. More people who never would have bought a meme coin in their life are buying meme coins because the president is telling them to. So I think you're seeing more people who are at risk of, of losing money from their investment on this getting involved. And you're also seeing the government not really take their side, because people in the government are involved in those crypto projects to begin with. So I think some of this will go back to Trump's original thoughts years ago that he was skeptical that this financial product would ever work. Right. That it would be okay for there not to be banks and financial institutions and regulators and, and watchdogs surveilling and supervising this industry. And yet he's kind of come out on the other side and found a way to benefit off of it. So I think that kind of leaves this unregulated industry to police itself.
- [28:31]
Colby Ikowicz
Drew, thank you so much for explaining this.
- [28:33]
Drew Harwell
Thank you.
- [28:37]
Colby Ikowicz
Drew Harwell covers technology for the Post. That's it for Post Reports. Thanks for listening. Today's show was produced by Rennie Svirnofsky with help from Lucas Trevor. It was mixed by Sam Baer and edited by Ariel Plotnik. Thanks to Shawn Boberg. You listen to Post reports because you value being informed. The Washington Post, the journalists on our audio team, throughout our newsroom and in bureaus around the world. It's what we all value. Strong reporting, scoops, holding power to account. And that is what a Washington Post subscription supports. Our Memorial Day sale is here, so if you're not a subscriber yet, this is the time. With this sale, you can get a subscription for just $2 every four weeks for your first year. And after that, it's just $12 every four weeks and you can cancel anytime. As always, there's a link to subscribe in our show notes or you can go to washingtonpost.com subscribe one more time. That is washingtonpost.com subscribe. It's a limited time offer, so take advantage of it now. I'm Colby Ekowitz. We'll be back tomorrow with more stories from the Washington Post.
- [29:58]
Drew Harwell
Foreign.
- [30:08]
Wix Advertiser
A business is hard work building your website shouldn't be. With wix, you can express your ideas, give direction, then leave the heavy lifting to AI, from site creation to branded content and images. Have fun with the details. Customize what you want the way you want and manage your whole business from a centralized dashboard with expert AI tools. Build, scale and enjoy the incredible results. You can do it all yourself on wix.