UAE secures stake in Trump crypto firm ahead of major AI chip deal

The Wall Street Journal (WSJ) has reported that the United Arab Emirates (UAE) signed a $500 million investment deal with US President Donald Trump’s cryptocurrency venture, World Liberty Financial.

According to the report published on February 1, the agreement was finalized just four days before Trump’s inauguration in January. Under the terms of the deal, the UAE acquired a 49% stake in the company.

Within weeks of the agreement being signed, the Trump administration reportedly lifted a ban on the sale of advanced artificial intelligence chips to the UAE.

$187 million paid to Trump family

Citing company documents and sources familiar with the matter, the report states that half of the $500 million investment was paid upfront.

Of this amount, companies linked to the Trump family received $187 million, while entities associated with Steve Witkoff, a co-founder of World Liberty Financial, received $31 million.

Witkoff, a New York real estate investor and a close confidant of Trump, was appointed by the president as a special envoy. In this capacity, he was tasked with overseeing negotiations with Russia regarding the war in Ukraine and discussions with Israel concerning Gaza.

The WSJ noted that the investment agreement was signed by the president’s son, Eric Trump.

US commitment for 500,000 chips

The WSJ further revealed that only months after the investment deal, the US administration committed to providing the UAE with access to approximately 500,000 advanced AI chips annually.

This volume is reportedly sufficient to power one of the world’s largest AI data center clusters.

Previously, the Joe Biden administration had imposed strict limitations on chip sales to the UAE due to the country’s close ties with China. Washington had expressed concerns that such technology could be transferred to Chinese hands through the UAE.

Trump’s decision paved the way for G42, an AI firm owned by UAE National Security Advisor Sheikh Tahnoon bin Zayed Al Nahyan, to procure 100,000 chips every year. The move was reportedly made despite G42’s existing links to the sanctioned Chinese tech giant Huawei.

“Impression of the government being up for sale”

Sheikh Tahnoon bin Zayed Al Nahyan, a member of the UAE royal family, is cited as the primary figure behind the investment.

Tahnoon has long been known to lobby for access to advanced US AI chips. Following Trump’s return to office, Tahnoon reportedly held numerous meetings with Witkoff and other US officials, including a visit to the White House in March.

The deal has sparked significant ethical debates in Washington. The WSJ described the situation as “unprecedented in American politics: a foreign government official taking a major ownership stake in the company of an incoming US president.”

Kathleen Clark, a law professor and former ethics legal counsel in Washington, stated that the investment “gives the appearance of a bribe.” She added, “This transaction serves as a high-level alarm that the federal government is effectively up for sale.”

Ty Cobb, a lawyer who served in the White House during Trump’s first term, argued that Trump’s conflicts of interest are far more extensive than those of any previous president.

“It’s like complaining about rowboats while B-52s are flying over your head,” Cobb remarked. “As an ethics lawyer, my advice would be clear: you do not do business deals with the families of foreign leaders. It pollutes American foreign policy.”

Connection between Binance and the pardon decision

In April, MGX, an investment firm managed by Tahnoon, announced a $2 billion investment in the cryptocurrency exchange Binance using World Liberty Financial’s stablecoin. This move reportedly provided World Liberty Financial with $2 billion in cash reserves.

The company reportedly uses these reserves to maintain the stablecoin’s one-to-one peg against the dollar. By investing the funds in US Treasury bonds, the firm earns approximately $80 million in annual interest.

In October, Trump granted a pardon to Binance founder Changpeng Zhao. Zhao had previously pleaded guilty to violating anti-money laundering regulations, a process that had led to Binance being banned in the US.

The pardon drew sharp criticism from Democratic lawmakers, some of whom accused Trump of “selling pardons to the highest bidder.” Zhao, who resides in Abu Dhabi and has obtained UAE citizenship, is known to be close to Sheikh Tahnoon and the UAE royal family.