On January 29, the US-listed company Trump Media & Technology Group (TMTG) officially announced the launch of the financial services and fintech brand Truth.Fi. It is entering the financial services and fintech sector. This news caused TMTG's stock DJT to rise 15%.
TMTG plans to invest $250 million of its over $700 million cash reserve through Fidelity Investments. In addition to investing in traditional investment tools, it will also invest in SMAs (separately managed accounts), ETFs, Bitcoin and crypto-currencies or crypto-related securities.
According to CNN, Delaney Marsco, the chief ethics counsel at the Campaign Legal Center, is now concerned about TMTG's foray into finance and crypto, as Trump is overseeing federal regulation of these industries.
Delaney Marsco said these business initiatives create more opportunities for conflicts of interest: the agencies regulating the financial industry will now be controlled by people appointed by President Trump, who will face how to handle issues affecting their boss's financial interests.
Richard Painter, a senior ethics lawyer in the Bush administration, said that Trump transferring shares to a trust does not alleviate conflicts of interest. The US president is getting deeper into the cryptocurrency business - and he is invoking an executive order on cryptocurrencies, Painter (now a law professor at the University of Minnesota) said in an interview.
In addition to the conflict of interest issue, Painter is also concerned that Trump's investments could further drive up the asset prices in the cryptocurrency market, posing systemic risks to the broader economy.
Painter said it is very dangerous for our economy that our president has such great executive power, and he is also investing in assets.
Devin Nunes, CEO and Chairman of TMTG, said we look forward to launching Truth.Fi, launching TMTG's investment products, and unlocking synergies. Truth.Fi is a natural extension of the Truth Social movement. We initially created a free speech social media platform, then added a super-fast TV streaming service, and now we are entering the investment products and decentralized finance space.
Truth.Fi products and services are expected to launch in 2025, subject to regulatory approvals and funding. This expansion will enhance TMTG's existing product portfolio, which includes the Truth Social platform and Truth+ streaming service.
Last week, Trump launched a multi-billion dollar MEME coin Trump on the eve of his inauguration, which has already faced criticism. According to The Guardian, TMTG has been working to build a social network to rival Meta's Facebook and Instagram, or Elon Musk's X.
