Will Crypto Lead to the Third Impeachment of Trump?

January 28, 2025

Will Crypto Lead to Trump's Third Impeachment?

Cryptocurrencies are baseball cards on steroids. That comparison makes no sense but we thought it was fun to make it. President Trump is just beginning his second term and is already involved in controversial actions that may lead to his third impeachment. We are not referring to policy decisions and administrative actions. We are referring to potential financial scandals such as the President's involvement in deregulating the cryptocurrency industry, while launching his own crypto coin, $TRUMP. 

Th $TRUMP Coin

On January 17, 2025, days before the inauguration of the Second Coming of Our Lord Trump, the 78 year old MAGA patriarch introduced the $TRUMP crypto coin for collectors, benefactors, and speculators. The coin's initial price was about $6.50. The coin quickly surged in value, over 10x, reaching a peak price of approximately $75, for a Trumpian market capitalization exceeding $10 billion. The coin then lost over 50% in value from its peak, trading at around $34 by January 20, 2025. As of today, January 28, 2025, the $TRUMP coin is trading at ~$29, which is still a 450% price increase in 11 days.

The $TRUMP coin has raised concerns among pundits and ethics experts. Critics highlight potential conflicts of interest, given President Trump's direct involvement in the regulation of the cryptocurrency industry while holding office. Additionally, the volatility of the coin's value has led to apprehensions about market manipulation and the broader implications for the cryptocurrency industry, which is already shamed with past incidents of notorious scams and fraudulent hacks. 

Critics, including ethics watchdogs and legal experts, argue that Trump's direct involvement in promoting and benefiting from a cryptocurrency while simultaneously influencing crypto market policies as president presents a clear conflict of interest. The fact that Trump and his affiliates hold a substantial portion of the coin's supply—reportedly around 80%—has led to fears of potential market manipulation and "pump-and-dump" schemes, where the coin's value could be artificially inflated and then sold off for profit, leaving other investors at a loss. Others fear that foreign entities and influencers may purchase the coin to indirectly bribe the president.

The launch of such a crypto coin by a sitting president has been described as "outrageous" by former Federal Election Commission general counsel Larry Noble, who emphasized the ethical implications and the potential for foreign actors to use the cryptocurrency to gain favorable treatment from the administration. The situation is compounded by the broader context of the Trump administration's pro-crypto stance, including efforts to ease regulations on the cryptocurrency industry. This has led to concerns that the administration's policies may prioritize industry growth over investor safety and ethical standards. 

In summary, Trump's direct involvement in the cryptocurrency market and his administration's regulatory actions have sparked a potential scandal characterized by allegations of self-enrichment, conflicts of interest, and ethical violations.

Trump's Impeachments

Former President Donald Trump was impeached twice by the U.S. House of Representatives during his first term, making him the first president in American history to be impeached twice. In both instances, he was acquitted by the Senate and thus remained in office.

First Impeachment (2019–2020):

Charges: Abuse of power and obstruction of Congress.

In a July 25, 2019, phone call, President Trump urged Ukrainian President Volodymyr Zelenskyy to investigate former Vice President Joe Biden and his son, Hunter Biden. At the time, Joe Biden was a leading candidate for the 2020 presidential election. It was alleged that Trump withheld $391 million in military aid to Ukraine to pressure Zelenskyy into announcing these investigations. This action was seen as soliciting foreign interference in a U.S. election.

Following a whistleblower complaint and subsequent investigations, the House of Representatives impeached Trump on December 18, 2019. The votes were largely along party lines.

The Senate trial commenced on January 16, 2020. On February 5, 2020, the Senate acquitted Trump on both charges. The vote on abuse of power was 48 guilty to 52 not guilty, with Senator Mitt Romney being the only Republican to vote for conviction. On obstruction of Congress, the vote was 47 guilty to 53 not guilty.

Second Impeachment (2021):

Charge: Incitement of insurrection.

On January 6, 2021, a mob of Trump supporters attacked the U.S. Capitol, disrupting the certification of the Electoral College results of the 2020 presidential election. Prior to the attack, Trump had addressed a rally, reiterating claims of widespread election fraud and encouraging his supporters to "fight like hell." The House argued that his rhetoric incited the violence that ensued.

On January 13, 2021, the House impeached Trump for incitement of insurrection. This vote was more bipartisan, with ten Republicans joining Democrats in favor.

The Senate trial began on February 9, 2021. On February 13, 2021, the Senate acquitted Trump, with a vote of 57 guilty to 43 not guilty, falling short of the two-thirds (66) majority required for conviction. Seven Republican senators voted to convict, marking the most bipartisan support for conviction in a presidential impeachment trial.

These impeachment proceedings underscored deep political divisions within the United States and highlighted ongoing debates about presidential conduct and accountability. Trump's involvement into cryptocurrencies may lead to a third impeachment if Democrats regain control of the House of Representatives in 2026. By 2027, we would surely be covering the third impeachment of Trump.

What are Cryptocurrencies anyways?

Cryptocurrencies are digital tokens accounted for on decentralized networks that use cryptographic technologies such as the blockchain ledger. Blockchain is a digital ledger maintained across the network of approximately 70,000 computers running the blockchain software. Entries on the ledger are democratically validated by the majority of the network participants rather than by a central authority. 

Key Features of Cryptocurrencies: [Mnemonic: DATAS]

• Decentralization: Cryptocurrencies are managed by the consensus of decentralized networks rather than by a central authority like governments or their central banks.
• Accessibility: Transactions can occur across borders without government or financial intermediaries.
• Transparency: Transactions are recorded on a digital ledger kept by thousands of computers, making transactions transparent to anyone worldwide.
• Anonymity: Depending on the cryptocurrency, users may be allowed to transact using personal identification numbers (PINs) rather than their government ID numbers.  
• Security: Cryptographic algorithms are meant to ensure the legitimacy of transactions and prevent counterfeiting.

Major Cryptocurrencies:

• Bitcoin (BTC): The first and most widely recognized cryptocurrency, created in 2009.
• Ethereum (ETH): Known for its smart contract functionality, enabling decentralized applications (dApps).
• Tether (USDT): A "stablecoin" pegged to traditional currencies like the U.S. dollar.
• Binance Coin (BNB): A utility token used on the Binance exchange.
• Cardano (ADA): A blockchain platform focused on scalability, sustainability, and security through a proof-of-stake (PoS) consensus mechanism. Known for its academic and peer-reviewed development approach.
• Solana (SOL): A high-performance blockchain designed for decentralized applications (dApps) and crypto projects. Offers low transaction fees and high throughput, making it a competitor to Ethereum.
• Ripple (XRP): A digital payment protocol primarily designed for cross-border payments and remittances. Known for partnerships with financial institutions.
• USD Coin (USDC): A stablecoin pegged to the U.S. dollar, backed by reserves of cash and short-term U.S. government securities. Frequently used in DeFi platforms for lending and trading.
• Polkadot (DOT): A multi-chain blockchain platform enabling interoperability between different blockchains. Designed to facilitate the transfer of data and assets across diverse networks.
• Dogecoin (DOGE): Originally created as a meme-based cryptocurrency, it has since gained traction as a widely used token, especially for tipping and online payments. 
• Shiba Inu (SHIB): Another meme coin inspired by Dogecoin, it has grown into an ecosystem with decentralized exchanges and staking capabilities.
• Litecoin (LTC): Created as a "lighter" alternative to Bitcoin, offering faster transaction times and a different hashing algorithm. Often referred to as "silver to Bitcoin's gold."
• Polygon (MATIC): A layer-2 scaling solution for Ethereum, enabling faster and cheaper transactions. Focused on improving Ethereum’s scalability.
• Avalanche (AVAX): A blockchain platform with high-speed transaction capabilities and a focus on scalability and decentralized applications. Competitor to Ethereum and Solana.
• Chainlink (LINK): A decentralized oracle network that provides real-world data to smart contracts on blockchains. Used widely for integrating off-chain data.

These cryptocurrencies showcase the diversity of use cases in the crypto space, from payment systems and decentralized finance to scalability and privacy.

The Crypto Industry:

The cryptocurrency industry encompasses various sectors, including:

• Development: Creating infrastructure, apps, and protocols powered by blockchain technology.
• Exchanges: Platforms where cryptocurrencies are bought, sold, or traded (e.g., Binance, Coinbase).
• Mining: Computer owners that run the software and processes for validating transactions and securing networks in exchange for rewards.
• DeFi (Decentralized Finance): Financial services like lending, borrowing, and trading conducted without intermediaries.
• NFTs (Non-Fungible Tokens): Unique digital assets representing ownership of art, music, or virtual items.

Opportunities in the Crypto Industry:

• Freedom: Offering financial services free of government intervention. 
• Innovation: Driving advancements in decentralized technology and digital assets.
• Speculation: Cryptocurrencies are speculative gambles with potential for high returns.

Challenges and Risks in the Crypto Industry:

• Volatility: Cryptocurrency prices fluctuate wildly, creating financial risks for holders.
• Regulation: Governments are grappling with how to regulate the industry without stifling innovation.
• Fraud: The lack of regulation has led to many fraudulent schemes, hacks, and scams.
• Sustainability: Mining processes for some cryptocurrencies, like Bitcoin, consume significant energy.

In summary, the crypto industry represents a revolutionary shift in digital assets, finance, and technology, though it is still evolving and faces challenges related to regulation, security, and adoption.

Fraudulent Scams in the Crypto Industry

The cryptocurrency industry has witnessed several significant fraud cases recently, highlighting the need for increased regulatory oversight and investor vigilance.

Binance Under Investigation in France:

On January 28, 2025, French authorities initiated a judicial investigation into Binance, the world's largest cryptocurrency exchange, over allegations of money laundering, tax fraud, and other charges. The probe focuses on activities between 2019 and 2024, including accusations of facilitating money laundering related to drug trafficking and operating without necessary approvals. This investigation adds to Binance's legal challenges, as it faces scrutiny in multiple countries, including the United States and Australia. 

KuCoin's Legal Troubles in the United States

On January 27, 2025, KuCoin, a prominent cryptocurrency exchange, pleaded guilty to operating an unlicensed money-transmitting business in the U.S. The company agreed to pay over $297 million in fines and forfeitures, comprising a $112.9 million criminal fine and a $184.5 million forfeiture. As part of the settlement, KuCoin will exit the U.S. market for at least two years, and its co-founders will forfeit $2.7 million each and step down from management roles. The U.S. Department of Justice highlighted that KuCoin's inadequate anti-money laundering measures facilitated billions in suspicious transactions. 

FTX Collapse and Legal Repercussions

FTX, once a leading cryptocurrency exchange, collapsed in November 2022, leading to significant legal actions. Founder Sam Bankman-Fried was charged with fraud, conspiracy to commit money laundering, and campaign finance violations. Sam Bankman-Fried was convicted in November 2023 on seven counts of fraud and conspiracy related to the collapse of FTX in November 2022. On March 28, 2024, he was sentenced to 25 years in federal prison and ordered to forfeit $11 billion. Bankman-Fried is appealing the conviction, arguing that the jury was not presented with crucial evidence that could have influenced the verdict and that the trial judge was biased and made mistakes that prevented Bankman-Fried from presenting a full defense. Bankman-Fried's lawyers are asking for a new trial with a different judge. Bankman-Fried is currently incarcerated at the Metropolitan Detention Center in Brooklyn, New York, awaiting the outcome of his appeal. Other FTX key executives, including co-founder Gary Wang and Alameda Research CEO Caroline Ellison, pleaded guilty to multiple charges and cooperated with prosecutors. 

WazirX Hack

In July 2024, India-based cryptocurrency exchange WazirX suffered a significant security breach, resulting in the loss of approximately $234.9 million in investor funds. The attack was attributed to the North Korean hacking group Lazarus. Following the breach, WazirX suspended trading activities and faced legal challenges, including a lawsuit from rival company CoinSwitch seeking to recover trapped funds. 

HyperVerse Fraud Allegations

HyperVerse, formerly known as HyperFund and HyperNation, was a cryptocurrency hedge fund that collapsed in 2024, leading to approximately $1.3 billion in customer losses. Investigations revealed that the purported executive director, Steven Reece Lewis, did not exist, and the company had fabricated his identity to deceive investors. In January 2024, Australian entrepreneur Sam Lee, chairman of HyperTech, the company operating HyperVerse, was charged with conspiracy to commit fraud in the U.S. 

Money Laundering

Cryptocurrencies have been associated with money laundering. Their pseudonymous nature, global accessibility, and decentralization make them attractive for criminals seeking to launder funds. However, regulatory frameworks and blockchain analytics have significantly improved in identifying and preventing illegal activities.

How Cryptocurrencies Are Used in Money Laundering?

1. Mixing Services (Tumblers):

   - These services blend transactions from multiple users, making it difficult to trace the origin of funds.

   - Example: Blender.io, which was sanctioned by the U.S. government for laundering funds for North Korean hackers.

2. Privacy Coins:  

   - Cryptocurrencies like Monero (XMR), Zcash (ZEC), and Dash (DASH) offer enhanced privacy, making it harder to track the true source of transactions and facilitating money laundering. Some exchanges have delisted privacy coins due to regulatory pressure from different governments around the world.

3. Layering Through Exchanges and DeFi Platforms:

   - Criminals move funds through multiple crypto exchanges (especially those with weak Know Your Customer (KYC) policies). Decentralized Finance (DeFi) platforms, where users can swap crypto assets anonymously, are also used to hide or mask the true source of funds.

4. Shell Companies and ICOs:  

   - Fraudsters create fake Initial Coin Offerings (ICOs) to raise money and then launder illicit funds. Some companies use crypto to move money across borders without detection.

5. Gambling and NFT Wash Trading:

   - Criminals use online crypto casinos to convert illicit crypto into legitimate winnings. Bad actors buy and sell NFTs between wallets they control, creating fake transactions to create fronts to hide the true source of revenues.

Real-World Cases of Crypto Money Laundering

• Binance Investigation (2024-2025): Binance is currently under scrutiny in various countries for alleged money laundering violations across multiple jurisdictions.
• KuCoin (2025): Agreed to pay nearly $300 million for failing to implement anti-money laundering (AML) measures.
• Bitfinex Hack (2016, Recovered in 2022): $4.5 billion in stolen Bitcoin laundered through multiple transactions before U.S. authorities recovered the funds.
• North Korea's Lazarus Group: Used cryptocurrency to evade sanctions and launder stolen digital assets, funding missile programs.

Regulations and Crackdowns

• Financial Action Task Force (FATF): Implements the "Travel Rule" requiring exchanges to collect and share customer information.
• Blockchain Analytics Tools: Companies like Chainalysis and Elliptic offer software that can track suspicious transactions and assist in law enforcement investigations.
• Prior to the Second Coming of Trump, the U.S. Treasury & DOJ were actively investigating crypto firms and imposing stricter compliance requirements.

Is it smart for Trump to get involved in the crypto industry launching his own crypto coin?

We don't think so, but we may be wrong. Time will tell. The future has not been created yet. From a distance, it looks like the President is walking on a minefield where the risks of being blown up significantly outweigh the potential rewards of making a few extra billions. At the end of the day, it is not money what saved money from jail, but rather democracy. The problem with democracy is that it changes as the masses change their feelings. 

A huge crypto scandal may turn off a sufficient number of Trump supporters while turning on many Trump opponents. Democrats could regain control of Congress in 2026 and go for a third impeachment. The third time may be the charm. It could be smart for Trump to stay out and away from the controversial and risky crypto industry. 

We could be wrong. We have been wrong many times, especially in many things related to Trump. For example, we thought that buying DJT stock after the election would be a good idea and it has turned into a money pit. The Trump Media & Technology Company keeps losing money and the stock keeps going down and down. The 78 year old can't lift his stock. Now we're stuck holding Trump's failed stock.

Now you know it. 

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