On January 29, Trump Media & Technology Group (TMTG), a US-listed company, officially announced the launch of the financial services and fintech brand Truth.Fi, entering the financial services and fintech fields. Influenced by this news, the stock of Trump Media & Technology Group DJT rose by 15%.
Trump Media & Technology Group plans to invest $250 million of its more than $700 million cash reserves through Charles Schwab. In addition to investing in traditional investment vehicles, it will also invest in SMAs (separately managed accounts), ETFs, Bitcoin and crypto-like or crypto-related securities.
According to CNN, Delaney Marsco, ethics director of the Campaign Legal Center, is now concerned about Trump Media Group's entry into finance and encryption because Trump is presiding over federal government regulation of these industries.
Delaney-Musco said the business moves create more opportunities for conflicts of interest: The various agencies that regulate the financial industry will now be controlled by people appointed by President Trump himself, who will face questions about how to deal with matters that affect their boss' financial interests.
Richard Painter, a top ethics lawyer in the George W. Bush administration, said Trump's transfer of shares to a trust does not alleviate the conflict of interest. The president of the United States is getting deeper and deeper into the cryptocurrency business — and he's invoking an executive order on cryptocurrencies, Painter, now a law professor at the University of Minnesota, said in an interview.
In addition to conflict of interest concerns, Painter is concerned that Trump’s investment could further drive up asset prices in the cryptocurrency market, posing a systemic risk to the broader economy.
Painter said that the fact that we have a president with so much executive power and who is investing in assets is very dangerous for our economy.
Devin Nunes, CEO and Chairman of Trump Media & Technology Group, said, "We look forward to launching Truth.Fi, launching TMTG's investment vehicle, and unlocking synergies. Truth.Fi is a natural extension of the Truth Social movement. We initially created a social media platform for free speech, then added an ultra-fast TV streaming service, and now are moving into investment products and decentralized finance."
Truth.Fi products and services are expected to launch in 2025, subject to regulatory approval and funding. The expansion will enhance TMTG’s existing product portfolio, which includes the Truth Social platform and Truth+ streaming service.
Trump has already faced criticism for launching the multibillion-dollar meme coin Trump on the eve of his inauguration last week. According to the British newspaper The Guardian, Trump Media Technology Group has been working to build a social network to be closer to Facebook and Instagram owned by Meta, or X owned by Elon Musk.
