Bloomberg: Americans Can't Buy Trump, Regulatory Concerns Stall Dinner Who Can Go?

Original Title: Top Trump Crypto Buyers Vying for Dinner Seats Are Likely Foreign, Data Shows

Original Authors: Leonardo Nicoletti, Anthony Cormier, David Kocieniewski

Original Translation: Luffy, Foresight News

More than half of the large holders of Trump Meme Coin are from overseas exchanges that claim to ban US users, indicating that many buyers are from outside the United States.

Trump is a cryptocurrency that President Trump started promoting a few days before his inauguration day. Following an unprecedented promotional event, sales of the Trump token have surged in the past two weeks: Over 200 of the largest token holders will be invited to a dinner on May 22 at the Trump Virginia Golf Club, with the top 25 holders qualifying for an exclusive pre-dinner reception and a "VIP" tour described on the Trump token website.

Now, an analysis by Bloomberg News shows that, among the top 25 holders registered on the website leaderboard, all but 6 have used overseas exchanges that do not accept US residents. Among the top 220 holders on the leaderboard, at least 56% have used similar offshore exchanges. The widespread presence of these potential foreign buyers echoes Democratic lawmakers' ethical concerns about promoting the token as a promise of access to the president. It has also raised questions about how the vetting of dinner participants will be conducted, as the publicly available identities of these participants are only associated with a username consisting of a few letters.

Most Top Trump Token Holders Likely Located Outside the US

The value of the tokens held in the 220 cryptocurrency wallets registered on the TRUMP leaderboard (based on the likely location of the wallet holders). 76% of the token value held in the top 220 wallets is likely owned by foreign holders, as these wallets are using exchanges that US residents cannot access. Source: Bloomberg analysis of SolScan data. (Note: Data as of 10:00 AM Eastern Time on May 5th. Usernames are as listed on the TRUMP token website, set by wallet holders when registering for the dinner promotion event. One wallet still in the top 25 on the leaderboard is not listed here as it almost entirely sold off its holdings on May 3.)

In the website's fine print, the organizers state that participants must undergo a background check. The site reads, "We will also KYC and AML check your wallet for compliance purposes. You'll be dining with the U.S. President!" However, the website does not detail how such checks will be carried out.

Advocates for the TRUMP token did not respond to requests for comment, and White House officials did not respond either.

To make it to the dinner table leaderboard, those who purchased TRUMP coins had to register on their website, which stated that they would rank individuals based on the amount of tokens held and the duration of the holdings; many whale holders have not registered. However, an analysis by Bloomberg of all top buyers, regardless of leaderboard status, revealed that over half of this broader buyer group came from foreign exchanges.

It's possible that some U.S. buyers found ways to bypass the ban using overseas exchanges, such as employing a Virtual Private Network (VPN) to conceal their U.S. IP address. Most exchanges claim to have measures in place, such as collecting user information, to try to prevent such circumvention. The top three foreign exchanges most commonly used by whale TRUMP token holders to either fund their accounts or purchase TRUMP coins are Binance, Bybit, and OKEx, all three of which restrict U.S. users. Bloomberg's analysis found that six holders on the TRUMP token leaderboard made purchases on OKEx before its April 15th debut in the U.S. A spokesperson for OKEx stated that prior to this, the company did not allow U.S. residents to make purchases. Representatives from Binance and Bybit did not respond to requests for comment.

Two of these exchanges had previously violated U.S. laws. In November 2023, Binance pleaded guilty to weak internal controls that violated federal anti-money laundering and sanctions laws, paying over $4 billion to the U.S. OKEx admitted in February to breaching anti-money laundering rules and paid over $420 million.

Cryptocurrency projects linked to Trump have attracted significant foreign investment, marking not the first occurrence.

Cryptocurrency entrepreneur Justin Sun from Hong Kong became an advisor to another cryptocurrency project endorsed by the Trump family, World Liberty Financial's token (WLF), after announcing the purchase of tens of millions of dollars' worth of tokens. Justin Sun stated at the time that he did not expect any benefits from Trump due to this investment. According to Bloomberg's analysis of cryptocurrency wallet transactions, Justin Sun may also be a whale holder of the TRUMP token.

On May 8, 2020, Justin Sun, the founder of the blockchain platform Tron, was in Hong Kong. Source: Bloomberg

World Liberty is promoting a stablecoin. Zach Witkoff, one of the company's founders and son of a Middle East envoy for Trump, announced at a meeting on Thursday that this stablecoin would facilitate a transaction between Binance and an Abu Dhabi government-founded investment firm. Executives at World Liberty did not respond to requests for comment.

Tony Carrk, Executive Director of the nonprofit organization Accountable.US, stated, "Congress should require the President to disclose those who are secretly contributing to him to assess whether the public interest is being harmed." The organization has set up the "Trump Accountability War Room" online. Accountable.US found that among the top 50 holders of World Liberty tokens, at least 14 individuals also use cryptocurrency services that are not accessible to Americans. Bloomberg's analysis identified an additional 8 such wallets. World Liberty disclosed in November that the initial $300 million issuance was primarily sold overseas.

Many Large Holders of WLF Tokens Are Located Overseas

Distribution of holdings for the top 50 wallets with the most WLF tokens (based on likely location of wallet holders). Data Source: Accountable.US, Bloomberg analysis of Etherscan data. Note: Data is as of 6:45 PM ET on April 30.

While previously calling Bitcoin a "scam against the dollar," Trump, as he delves deeper into the cryptocurrency space, has begun dismantling regulatory and enforcement teams within his government that were originally tasked with overseeing these digital assets. For instance, shortly after he took office, staff at the U.S. Securities and Exchange Commission responsible for investigating cryptocurrency were reassigned, and many of their cases were put on hold. In April of this year, the U.S. Department of Justice disbanded its cryptocurrency enforcement team.

Last month, Democratic Senators Adam Schiff and Elizabeth Warren called on the U.S. Government Accountability Office to investigate the Trump Token dinner promotion event. They stated that the May 22 event posed "serious risks that the President and other officials may engage in corruption by selling access to the President to individuals or entities, while personally benefiting the President and his family."

The Trump family has benefited from the rise in the price of the TRUMP token, as a company they control holds a significant amount of this token. Although, according to the token issuance terms, the Trump family cannot sell any tokens for a period of time, any price fluctuations will change their wealth position on paper. The announcement at the April 23 dinner caused the token price to jump from around $9 to around $14, with 436 transactions of over $100,000 occurring in the following five days, the largest involving an account interacting with a platform not operating in the United States.

Spike in Foreign Purchases Post-Dinner Announcement

April saw over $100,000 in TRUMP token purchases. Data Source: Dune; Bloomberg's analysis of SolScan data. Note: Data as of May 1.

To qualify for a dinner with Trump, token holders had to register a "self-custody" wallet, i.e., a wallet fully controlled by the holder and not by a third-party exchange.

Bloomberg analyzed the transactions of the top 220 wallets on the dinner leaderboard as of May 5 to determine if their holders may be from overseas. Another separate analysis looked into all self-custody wallets that held enough Trump tokens to qualify for the top 220 as of April 30. Many of the largest wallets were not listed on the dinner leaderboard, indicating they have not registered yet, or their time-weighted holdings may significantly differ from current holdings. Some may be strategically waiting to register.

While it's challenging to identify the people behind these accounts, there have been some public clues about some. In recent days, entities on the leaderboard have been swapping positions, with at least one entity boasting online about it. The wallet named "MeCo" belongs to an entity called "Memecore," which describes itself as an "L1 multi-chain cross-collateral mainnet compatible with the Ethereum Virtual Machine (EVM), secured by a Meme Proof-of-Stake."

The company stated on the X platform, "We not only want to be at the top of the TRUMP leaderboard, but we also want to dominate the entire Meme coin space." Memecore requested users to send their TRUMP tokens to it to boost rankings. The company mentioned that the tokens would be returned later to the users with rewards included.

Cherry Hsu, Chief Business Development Officer of Memecore, said in a statement on Telegram, "Currently, the Meme coin space is considered stagnant, and we want to challenge that notion. By participating in this event, we want to show that the Meme coin space is rising again."

According to Bloomberg's analysis of blockchain data, Memecore's top pursuer on the leaderboard has chosen the username "Sun" and has been using an HTX-affiliated wallet, which has ties to Justin Sun. Justin Sun himself has publicly acknowledged buying tokens from World Liberty Financial, but has not confirmed whether he owns the top wallet on the leaderboard. He did not respond to requests for comment.

The wallet labeled "Sun" has been accumulating tokens worth a total of $17.9 million since the launch of the Trump token in January. Since the announcement of the Trump Gala promotion, it has acquired an additional $4.5 million worth of tokens.

In 2023, the U.S. Securities and Exchange Commission sued Justin Sun, alleging that he collaborated with his own company to scheme the issuance and sale of unregistered securities. Justin Sun's lawyers denied these allegations, stating that the regulatory agency's claims were "too far-fetched and should be dismissed." In February of this year, after Justin Sun spent at least $75 million purchasing World Liberty Financial tokens, the U.S. Securities and Exchange Commission paused its lawsuit against him, citing considerations for a potential mutually beneficial resolution.

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