Warren, Reed: Loopholes in Trump-Endorsed Crypto Pose Risks for Illegal Financial Activities

Bitget App

Trade smarter

Bitget

News

Markets

Warren, Reed: Loopholes in Trump-Endorsed Crypto Pose Risks for Illegal Financial Activities

Bitget-RWA2025/11/18 12:06

By:Bitget-RWA

- U.S. Senators Warren and Reed demand federal investigation into Trump-linked crypto firm WLF over alleged ties to North Korean hackers and Russian sanctions evasion tools. - WLF's $WLFI token sales to entities like Lazarus Group and Tornado Cash raise risks of "supercharging illicit finance" and governance manipulation by foreign adversaries. - Trump family's 22.5B $WLFI token stake valued at $3B creates conflict of interest, with officials potentially prioritizing profit over compliance during Trump adm

U.S. Senators Elizabeth Warren and Jack Reed have called for a federal probe into

World Liberty Financial

(WLF), a cryptocurrency company with strong connections to the Trump family, pointing to suspected links with criminal organizations in North Korea and Russia. In a letter addressed to Attorney General Pamela Bondi and Treasury Secretary Scott Bessent, the senators

expressed concerns about national security

regarding WLF's sale of tokens to "entities raising significant suspicion," including groups associated with North Korean hackers under sanctions and Russian tools for evading sanctions.

According to a letter obtained by CNBC, the senators referenced a September report by the nonprofit Accountable.US, which

claimed WLF distributed its $WLFI governance tokens

to organizations tied to the Lazarus Group, a hacking group backed by North Korea, as well as Tornado Cash, a platform known for laundering money. The lawmakers stated that WLF's insufficient anti-money laundering and sanctions controls could "significantly boost illegal financial activities" and allow foreign adversaries to sway the company's governance.

WLF, which names Eric Trump, Donald Trump Jr., and Barron Trump as co-founders, has issued $WLFI tokens to fund ventures such as a debit card and tokenized commodities. However, the senators pointed out that DT Marks DEFI LLC, a Trump family-linked entity, owns 22.5 billion $WLFI tokens—worth over $3 billion—and receives 75% of the revenue from token sales. They argue this situation presents a conflict of interest for Trump administration officials, who could put financial gain ahead of regulatory compliance

as indicated by the investigation

This request for an investigation comes as lawmakers consider new cryptocurrency rules that might exclude governance tokens like $WLFI from current regulatory frameworks. Warren and Reed

stressed the importance

of making sure "crypto stakeholders do not benefit at the cost of U.S. national security." WLF has yet to issue a public response.

Meanwhile, North Korea has intensified its criticism of U.S. and South Korean military collaboration,

cautioning that agreements involving nuclear-powered submarines

could set off a "nuclear domino effect" in the area. Although not directly related to the WLF investigation, these remarks highlight wider geopolitical strains that may make enforcing sanctions and crypto regulations more challenging.

World Liberty Financial has come under scrutiny from various directions, including its stablecoin

USD1

, which was used by a UAE-supported fund to invest $2 billion in Binance. The company's association with prominent individuals and its governance approach have sparked debate about openness and responsibility in a sector already facing regulatory ambiguity.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

PoolX: Earn new token airdrops

Lock your assets and earn 10%+ APR

Lock now!

- Astar (ASTR) surged 1.95% as protocol upgrades and real-world adoption drive institutional confidence and whale accumulation. - Tokenomics 3.0 shifts to a fixed 10.5B supply by 2026, aligning incentives with deflationary mechanisms and cross-chain interoperability. - Partnerships with Casio, Sony , and Animoca expand ASTR’s utility in loyalty programs and Web3 ecosystems, boosting on-chain activity. - Despite a 24-hour volume of $5.6M, challenges like DeFi TVL declines and liquidity risks remain critical

Bitget-RWA•2025/11/18 18:14

Aster DEX Experiences Rapid Growth in DeFi Usage: Is This the Dawn of a New Era for Decentralized Finance?

- Aster DEX's hybrid AMM-CEX model and AI-driven liquidity routing drove 2M+ users in Q3 2025, addressing DeFi's slippage challenges. - Transparent tokenomics with public unlock schedules and 5% fee discounts stabilized ASTER's price, reaching $1.13 with $2.27B market cap. - Strategic Binance partnership enabled $3T+ trading volume, while Pro Mode and perpetual contracts expanded token utility beyond governance. - Despite centralization concerns and volatility-related glitches, Aster's crisis response and

Bitget-RWA•2025/11/18 18:14

Brazil's cryptocurrency rules drive capital inflows as other markets see outflows

- Brazil introduces tax on cross-border crypto transactions, aligning with CARF and OECD standards to close regulatory gaps and boost revenue. - Global crypto funds face $3.2B in outflows, driven by macroeconomic uncertainty and whale selling, contrasting Brazil's $42.8B crypto surge in H1 2025. - Brazil's $1.7T on-chain activity and stricter AML rules position it as a regional crypto oversight benchmark, expanding government visibility into crypto flows. - While U.S. crypto ETFs see $1.97B outflows, Germa

Bitget-RWA•2025/11/18 18:04

Brazil's cryptocurrency rules drive capital inflows as other markets see outflows

Fed Faces December Decision: Easing Labor Market Pressures or Tightening Inflation

- The Fed faces a December rate cut decision amid internal divisions, with a 50% chance of easing as labor market weakness clashes with inflation risks. - Governor Waller advocates for a 25-basis-point cut to support the slowing jobs market, contrasting with cautious officials like Collins and Jefferson. - Liquidity imbalances push the effective funds rate near the 3.90% excess reserves rate, prompting Treasury bill purchases to stabilize reserves and rates. - Market expectations remain calm, pricing in gr

Bitget-RWA•2025/11/18 18:04