The recent crypto market downturn has hit Trump-linked tokens particularly hard, as they recorded double-digit declines following the revelation of a Congressional investigation. Representative Ro Khanna is leading this inquiry into a $500 million deal between World Liberty Financial and the United Arab Emirates royalty.
This slump occurs in a high-stakes political context, marking a milestone of extreme volatility for assets like TRUMP and WLFI, which lead the top 100 losses. While the broader market retreats by 2.8%, these specific assets have collapsed more than 10% in the last 24 hours, generating doubts about the stability of their current valuations.
Legislative scrutiny on World Liberty Financial and AI chips
The core of the controversy lies in an alleged connection between the $500 million investment and the export of advanced AI chips. According to reports, the deal with Sheikh Tahnoon bin Zayed Al Nahyan preceded favorable foreign policy decisions, being a high risk factor that Democratic regulators are now examining very closely today.
Furthermore, the investigation requests details on the facilitation of a $2 billion investment in Binance through the firm’s USD1 stablecoin. This network of financial transactions, involving key figures like Zach Witkoff, has eroded investor confidence, evidencing a clear lack of conviction in the transparency of the cryptocurrency project.
Can these assets recover their value in the face of regulatory pressure from Washington?
The future viability of these projects depends on the outcomes of the investigation into potential conflicts of interest and national security. The TRUMP token, which has already lost 95% from its all-time high, now faces the challenge of surviving unprecedented legal scrutiny, which seems unlikely without an entry of immediate legal clarity.
If regulators find irregularities in the deals with G42 and the shipment of semiconductors, the selling pressure on Trump-linked tokens could intensify. Analysts like Simon Peters suggest that risk-off sentiment will dominate the sector, accentuating the deep corrective phase already affecting the main digital assets within the ecosystem.
For now, the market watches cautiously as ETF outflows and macroeconomic uncertainty complicate any attempt at a technical rebound. The resolution of this probe will mark the fate of assets linked to the presidential family, who maintain a cautious stance as their valuations continue to sink in global charts.
