Democratic lawmakers warned the Securities and Exchange Commission (SEC) about a conflict of interest in its regulation of the Trump family’s DeFi project, World Liberty Financial (WLF).

Senators Elizabeth Warren and Maxine Waters asked Acting SEC Chari Uyeda in an April 2 letter to safeguard and hand over information related to the Trumps’ WLF project to Congress.

They said the information would help them better understand whether the conflict of interest may be interfering with the SEC’s mission ”to protect investors and maintain fair and orderly markets.”

Lawmakers Claim Trump Crypto Ventures Present A Conflict Of Interest

“The Trump family’s financial stake in World Liberty Financial represents an unprecedented conflict of interest with the potential to influence the Trump Administration’s oversight — or lack thereof — of the cryptocurrency industry,” Warren and Water wrote in the letter.

They claimed that this potential conflict of interest has created “an obvious incentive for the Trump Administration to direct federal agencies” to take positions that align with the Trump family’s interests.

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Trump Family’s Crypto Conflict!

US lawmakers are pressing the SEC over potential conflicts of interest related to a Trump-backed crypto firm, World Liberty Financial. Senators Elizabeth Warren and Maxine Waters demand transparency on how Trump’s ties might influence SEC… pic.twitter.com/RSo4qFIhHN

— Klaus AI Agent (@Klaus_Agent) April 2, 2025

Warren and Waters went on to state that Americans deserve transparency regarding Trump’s crypto ventures. 

“The American people deserve to know whether their financial markets are being regulated impartially or whether regulatory decisions are being made to benefit the President’s family financial interests,” they said.

The letter is a reiteration of arguments made by Waters in an April 2 House Financial Services Committee hearing. According to the lawmaker, a lack of oversight and accountability around WLF could enable Trump to install the project’s stablecoin for government payments, allowing him to profit off from his position as US President. 

SEC Drops Multiple High-Profile Crypto Lawsuits Under Trump Leadership

The letter comes after the SEC opted to drop multiple lawsuits against companies operating in the crypto space in recent weeks.

Since Trump appointed Uyeda as the SEC’s acting Chair, the regulator has ended investigations and enforcement actions against well-known crypto firms including Coinbase, Gemini, Consensys, and Uniswap. 

Trump’s pick to Chair the SEC, Paul Atkins, is expected to face a vote in the Senate Banking Committee today. Should his nomination move out of committee, the full chamber will decide whether to confirm him.

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FAQs:

1. What is World Liberty Financial (WLF)?
   WLF is a cryptocurrency firm closely affiliated with President Donald Trump and his family, involved in launching digital assets like the stablecoin USD1.
2. Why are lawmakers concerned about WLF?
   Lawmakers are worried that the Trump family’s financial interests in WLF could influence the SEC’s regulatory decisions, potentially compromising the agency’s impartiality.
3. What actions have been taken by the SEC regarding WLF?
   The SEC has been asked to preserve and provide records related to WLF’s operations and communications with the Trump family, amid concerns of regulatory favoritism.
4. How much has the Trump family profited from WLF?
   Reports indicate that the Trump family holds a 75% claim on WLF’s token revenue, amounting to an estimated $390 million payout to date.
5. Who is Justin Sun, and what is his connection to WLF?
   Justin Sun is a cryptocurrency entrepreneur who invested $75 million in WLF after being charged with fraud in 2023. The SEC later paused its enforcement case against him, raising concerns about potential influence.
6. What is the stablecoin USD1?
   USD1 is a stablecoin launched by WLF, pegged to the U.S. dollar, and operates on blockchain platforms like BNB Chain and Ethereum. ​
7. How has the SEC’s approach to crypto regulation changed?
   Under Acting Chair Mark Uyeda, the SEC has shifted towards a more lenient stance, pausing or dropping enforcement actions against several crypto firms. ​
8. What legislative actions are being considered?
   The House Financial Services Committee passed the STABLE Act, aiming to regulate stablecoins. Democrats proposed amendments to prevent conflicts of interest, but they were rejected by the Republican majority. ​
9. What are the potential implications of these concerns?
   If the SEC’s impartiality is compromised, it could undermine investor confidence and the integrity of financial markets.​
10. What steps are being taken to address these issues?
    Lawmakers continue to press the SEC for transparency and accountability, seeking to ensure that regulatory decisions are made in the public interest.

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