US lawmaker warns TRUMP coin could threaten national security

California Representative Maxine Waters has raised alarms regarding the potential national security risks associated with President Donald Trump’s recently launched memecoin, the TRUMP token.  

During a January 22 meeting of the US House Financial Services Committee, Waters criticised Republican lawmakers for their lack of oversight concerning the cryptocurrency and its implications.  

She described the situation as “alarming,” noting that the Republicans' agenda did not address potential conflicts of interest related to the President's financial activities.

Waters pointed out that as Trump took office, he and his family had launched memecoins that significantly increased in value, raising concerns about corruption and financial misconduct.

“Hours before Trump took office, he and his family launched memecoins that have shot up in value, reportedly increasing his personal wealth and possibly providing a backdoor for sanctioned persons, hostile governments, and other bad actors to give money to Trump directly,” she stated.

The committee's new chair, French Hill, acknowledged the need for regulatory clarity in the digital asset space but did not directly address Waters' concerns.

He stated that the committee aims to provide innovators with tools for developing decentralised financial products while ensuring America remains a leader in financial technology.

Waters emphasised that Trump's memecoin could allow for anonymous financial transactions that circumvent national security laws.

She warned that investors might be left vulnerable if insiders decided to sell their stakes abruptly, potentially leaving them "holding the bag."

Despite initial volatility, the TRUMP token has seen a significant rise in market capitalisation since its launch, reaching over $14 billion.

The ongoing discussions within Congress reflect broader concerns about cryptocurrency regulation and its intersection with political interests.