World Liberty Financial, a cryptocurrency firm from the United States with ties to the Trump family, has garnered international attention by finalizing an agreement aimed at promoting blockchain technology in Pakistan. This development comes on the heels of a tragic terrorist incident in Pahalgam, which heightened tensions between India and Pakistan.
### Trump-connected Crypto Firm Enters Pakistan
The firm, which is predominantly owned (60%) by an entity associated with the Trump family, recently signed a letter of intent with the Pakistan Crypto Council during a trip to Islamabad. This agreement is designed to enhance the adoption of blockchain technology, stablecoins, and decentralized finance (DeFi) within the region. High-ranking officials from World Liberty Financial, including Zachary Folkman, Chase Herro, and Zachary Witkoff, engaged with key Pakistani leaders such as Prime Minister Shehbaz Sharif and army chief General Asim Munir. Other prominent figures in attendance included Finance Minister Muhammad Aurangzeb and the heads of the Securities and Exchange Commission and the State Bank of Pakistan, as reported by Dawn newspaper.
### Reasons for Concern Surrounding the Agreement
The timing of this agreement has raised red flags, particularly as it was established merely five days following a terrorist attack in Pahalgam that claimed 26 lives. India has accused two of the assailants of being from Pakistan, a claim that Pakistan has refuted. This sequence of events has sparked concerns in India, especially regarding issues of data security and national safety. An adviser to Indian policymakers expressed apprehension that the establishment of offshore crypto exchanges in Pakistan could lure Indian traders seeking to evade taxes. The adviser emphasized that the primary concern centers on the potential risk of Indian financial data being accessed by Pakistani entities.
### The Trump Family’s Influence in the Firm
World Liberty Financial is significantly influenced by the Trump family, with Donald Trump serving as the firm’s “Chief Crypto Advocate.” His sons, Eric and Donald Jr., hold the titles of “Web3 Ambassadors,” while Barron Trump is designated as the “DeFi Visionary.” In October 2024, the company successfully raised $300 million through the sale of its WLFI tokens and is also set to introduce a stablecoin called USD1, which will be backed by U.S. Treasury assets. Reports indicate that the firm has reached out to various cryptocurrency startups to negotiate currency swap arrangements, often exchanging its tokens for smaller amounts of other currencies in deals that were typically kept confidential and involved substantial fees.
### Ethical Implications of Increased Connectivity
A report from The New York Times highlighted that the Trump family’s extensive involvement in World Liberty Financial complicates the boundaries between business ventures and political activities. The report cited instances where the Trump-backed platform appeared to gain from legislative actions in Washington. Notably, Chinese crypto investor Justin Sun, who invested $75 million in WLFI, had his legal proceedings stalled by the SEC, while other investors like Arthur Hayes of Ethena and Binance founder Changpeng Zhao have encountered legal challenges. Additionally, the firm received a $25 million investment from Dubai’s DWF Labs to bolster its stablecoin initiative. Furthermore, a New York-based crypto firm that invested in World Liberty subsequently contributed to Trump’s inauguration and sponsored events linked to him.
### Pakistan’s Aspirations for Crypto Advancement
The Pakistan Crypto Council, bolstered by support from Trump and Binance’s Zhao, aims to position Pakistan as a central hub for cryptocurrency in South Asia. In 2024, Pakistan ranked 9th globally in terms of crypto adoption, boasting approximately 25 million users and annual transactions totaling around $300 billion. The Council’s CEO, Bilal Bin Saqib, has criticized India’s 30% tax on cryptocurrency trading, advocating for a more liberal approach in Pakistan. While this partnership holds the potential to elevate Pakistan’s cryptocurrency ambitions, the intertwined relationships between the Trump family, business interests, and foreign policy are raising eyebrows in both Washington and New Delhi.