(Bloomberg) — The pitch was simple: Invest in Donald Trump and his family’s cryptocurrency venture, support the industry’s most powerful ally at the peak of his influence, and split the spoils.
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Investors said yes, putting in more than $550 million in two fundraising rounds.
What happened next has not been made public. After these rounds were completed, the project sold an additional 5.9 billion tokens to accredited private investors; these transactions were worth hundreds of millions of dollars, and most of the proceeds were directed to entities affiliated with the founder.
The selloff came to light after intelligence platform Tokenomist.ai, which reviewed World Liberty’s management files at the request of Bloomberg, found that the number of tokens listed under founder, team, advisor and partner allocations had increased without apparent explanation; this was a discrepancy that the project did not disclose to its broader investor base.
World Liberty confirmed the sales to Bloomberg, describing them as “white glove” transactions with private buyers, but declined to say who the buyers were or where the money went.
What has emerged is unprecedented in American financial life. While an incumbent president’s family owns financial stakes in a live token project that sets governance rules, directs treasury sales, collects revenues, those who sign up find themselves with limited options for exit.
World Liberty Financial was co-founded by members of the Trump and Witkoff families and other business partners, with Zach Witkoff serving as chief executive. Both Trump and Steve Witkoff, who served as the president’s special envoy to the Middle East, are listed as an honorary co-founder on the project’s website. The project recently removed a page listing its co-founders; A spokesperson said the company updates its site regularly.
According to statements on the project’s website, DT Marks DEFI LLC, an entity affiliated with Donald Trump and certain family members, is entitled to receive 75% of the proceeds from the WLFI token sale, after deducting agreed-upon reserves and expenses. DT Marks and some Trump family members also own 22.5 billion WLFI tokens. World Liberty declined to say who received the money from the additional sales.
The project’s early investors were given the chance last year to sell 20% of their holdings (tokens purchased for as little as 5 cents), but they can’t sell the rest. Unlike most token sales, World Liberty did not offer investors an upfront unlock program.
The White House said Trump was not involved in running the family’s crypto ventures, handing control over to the family and business partners.
“President Trump’s assets are in a trust managed by his children. There is no conflict of interest,” White House spokeswoman Anna Kelly said.
White House Counsel David Warrington said Witkoff had left World Liberty Financial and was not involved in official matters that could affect his financial interests.
Under a governance proposal now before investors, no one (founders or initial buyers) will be able to sell their holdings for at least two years, after which the tokens will begin to be gradually unlocked over several years. Investors who do not accept the new terms will risk having their tokens locked indefinitely. Insiders who accept the vesting program will also be required to permanently burn 10% of their token allocation; This is a structure where the project is designed to align founder and investor interests.
“We have great faith in this vision and take a long-term view of everything we do, from our fundraising efforts to the careful preparation of management proposals designed to benefit the entire ecosystem,” said David Wachsman, a spokesman for World Liberty Financial.
The broader Trump family business has been reshaped by crypto. The family built its fortune on licensing the Trump name (real estate, Bibles, sneakers), but digital assets have opened up a new revenue stream.
Things turned out differently for World Liberty’s investors than many expected. Early buyers are left out of 80% of their token holdings and are unable to sell into a market that is already moving harshly against them. WLFI hit new lows in open trading this week, trading below 6 cents.
“It is surreal that the Trump family not only profited from this financial venture with glaring conflicts of interest, but did so in a way that prevented other investors from sharing in the gains,” said Eswar Prasad, a professor at Cornell University.
The project’s most high-profile external backer decided to intervene.
Justin Sun, the billionaire founder of the Tron blockchain, sued the startup in San Francisco federal court in April, alleging extortion and an illegal scheme to seize its tokens; The co-founders of the project deny these accusations. Sun claimed that he invested $45 million in WLFI and was not allowed to sell even a single token.
Syed Sameer, managing director of Sameer Group, a Dubai-based investment firm that Syed said has invested in the WLFI token along with its UAE corporate partners, issued an offer for X to Sun and offered to help negotiate a solution.
“Instead of a legal battle,” Syed told Bloomberg, Sun “could reach an amicable solution through neutral intermediaries.” Sun told Bloomberg that he forwarded Syed’s communication to his lawyers.
Beyond the lawsuit, the project invested 5 billion of its own WLFI tokens into Dolomite, a decentralized lending protocol whose co-founder had a role at World Liberty, and borrowed nearly $75 million worth of stablecoins against them. Critics say this structure could allow insiders to convert assets into cash rather than waiting for an unlock that could come years later. World Liberty said the position was “not close to liquidation” and that it had repaid $25 million of the loan, with $50 million outstanding as of mid-April.
As token prices decline, World Liberty’s broader corporate orbit is strained. Alt5 Sigma, a Nasdaq-listed company that raised $1.5 billion in August 2025 to accumulate WLFI tokens, announced its move into artificial intelligence. A recent filing stated that it “may use or redeem a portion of its token holdings to fund operations, meet obligations, or pursue strategic initiatives.” Tony Isaac, CEO of Alt5, told Bloomberg that the company has no plans to sell the token and may in fact continue to accumulate it.
World Liberty co-founder and CEO Zach Witkoff chairs Alt5’s board of directors. Zak Folkman, one of the co-founders of World Liberty, is also on Alt5’s board of directors.
The problems arise with a broader reckoning. Across the Trump family’s crypto empire (a memecoin is down more than 40% this year and is down 93% from its post-inaugural peak, a Bitcoin mining startup whose shares have lost most of their value, and now Alt5 is down nearly 90% since the WLFI accretion pivot) the pattern is similar: Projects that took off on the Trump brand are now pivoting or restructuring, as the political trading that fueled initial excitement collides with a cooling crypto market. Those who bought shares of Trump Media & Technology Group, Truth Social’s parent company, during its opening weekend in 2025 lost nearly three-quarters of their money.
There is little formal recourse for investors affected by market disruption. Token projects operate outside the requirements governing publicly traded companies; There is no audited financial information, no mandatory reporting of insider transactions, and no independent board audit.
“Foundation treasuries are at the discretion of the project and there is no mandatory requirement to disclose or restrict how they are used,” said Tanawat Chiewhawan of Tokenomist.ai. “Some projects are similarly allocating treasury tokens to private investor rounds.”
–With help from Annie Massa and Jeff Mason.
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