Topline
A Trump Organization-backed crypto deal was quietly revised weeks after it was announced, with Eric Trump no longer joining the board of fintech firm Alt5 Sigma as initially planned, following the firm’s consultation with Nasdaq—though the company did not explain why.
Alt5 Sigma announced in August it would raise $1.5 billion through direct and private sales of its shares and use the proceeds to buy digital tokens from World Liberty Financial, a crypto startup whose cofounders include Donald Trump and his three sons.
As part of the deal, Alt5 Sigma said “Eric Trump will become a director on its board of directors” and World Liberty Financial COO and fellow co-founder Zak Folkman would join as a board observer.
Two weeks later, Alt5 Sigma disclosed in an SEC filing that, after discussions with Nasdaq, to comply with its listing rules, Trump would instead be a board observer and, subject to stockholder approval, Folkman would be appointed as a director.
The filing did not specify which Nasdaq rule prompted the change, and the company offered no explanation.
A Trump-affiliated LLC owns around 38% of World Liberty Financial, as well as 22.5 billion of its $WLFI tokens and is entitled to about 75% of the proceeds from token sales.
Alt5, World Liberty Financial and Eric Trump did not respond to Forbes’ inquiries, and a Nasdaq spokesperson declined to comment.
It’s not clear. The SEC filing said the change was made “after discussion with The Nasdaq Stock Market LLC (‘Nasdaq’), and in order to comply with Nasdaq’s listing rules.” But it did not specify which rule or explain why Eric Trump was replaced by another World Liberty Financial executive, Zak Folkman. Three securities law professors reviewed the filings at Forbes’ request, but none could identify a clear reason why Nasdaq would accept one appointee from the company while rejecting another. Nasdaq rules require a majority of board members at listed companies to be independent, but if Trump didn’t qualify as independent, it’s not clear why Folkman would. The change also does not appear to be related to Trump’s legal standing in New York, where he is barred from serving as an officer of a New York corporation, as Alt5 Sigma is incorporated in Nevada.
World Liberty Financial launched in September 2024, presenting itself as a decentralized finance platform “inspired by the vision of Donald J. Trump.” It began selling non-transferable $WLFI tokens the following month to accredited and foreign investors, initially pricing them at $0.015, with a second round at $0.05. The tokens do not represent ownership in the company and are not backed by any underlying assets, but they allow holders to vote on rule changes to the protocol. In July, investors voted to allow early holders to sell a portion of their tokens, though founders—including the Trumps—remain restricted. As of Sept. 8, the tokens were trading at $0.2092, more than four times what many early investors paid, but down about 30% from their high on the public market.
$1.5 billion—the market value of Alt5 Sigma’s $WLFI holdings as of Sept. 8, based on the token’s trading price of $0.2092. The company acquired 7.3 billion tokens at $0.18 each, meaning the stake has appreciated by about $210 million in less than a month.
“After discussion with The Nasdaq Stock Market LLC (‘Nasdaq’), and in order to comply with Nasdaq’s listing rules, Zachary Witkoff, has accepted his appointment as Chairman of the Board and is the initial nominee to the Board selected by WLF,” the SEC filing said. “Both Eric Trump and Zachary Folkman have been designated as observers. Subject to and following the approval of the Company’s stockholders in accordance with Nasdaq’s listing rules, the Board has also approved the appointment of Zachary Folkman, the other nominee to the Board selected by WLF, as a director.”
Alt5 Sigma’s website still lists Eric Trump as a director on both its leadership and investor relations pages, despite the SEC filing stating he is a board observer.
Donald Trump is richer than ever. Forbes now estimates his net worth at $7.3 billion, up from $4.3 billion in 2024—driven largely by cryptocurrency holdings and the financial benefits of returning to the presidency. The $3 billion gain pushed him to No. 201 on this year’s Forbes 400, his highest rank ever. Other family members—Eric among them—also saw their fortunes surge.
In the same SEC filing that disclosed Eric Trump’s role change, Alt5 Sigma revealed a Rwandan court had recently found its Canadian subsidiary and former principal, Andre Beauchesne, criminally liable for illicit enrichment and money laundering. The court dissolved the subsidiary, sentenced Beauchesne to prison and ordered the seizure of $3.5 million. The company and Beauchesne appealed in June, claiming they were the victims of fraud. Alt5 said its board only became aware of the ruling in late August.
The same SEC filing also disclosed Alt5 Sigma received a summons and complaint in August tied to a bankruptcy case involving its former CFO, Virland Johnson. The complaint alleges Johnson failed to disclose restricted stock units entitling him to 330,000 shares in his January 2024 bankruptcy petition. U.S. trustees are seeking to recover the shares or their value from the company, which disputes any allegations against it.
“How Trump’s Sons Cashed In On Their Father’s Comeback” (Forbes)
“How Barron Trump May Have Earned $40 Million From His Dad’s Crypto Venture” (Forbes)
“Crypto Now Accounts For Most Of Donald Trump’s Net Worth” (Forbes)