Trump's family makes $5 billion. What does crypto in Pakistan have to do with it?
Pakistan is becoming a huge hub for crypto and allegedly for bitcoin mining, while helping prop up the Trump family's business priorities.
A few months ago, we wrote about an online scam where syndicates with ties to Pakistan and Texas were defrauding people who have visions of writing a personal memoir.
How it works: scammers pose as ghostwriters claiming a fascination in someone’s life story. But in fact these “ghostwriters” are low-wage workers in places like the Philippines and Pakistan, toiling for the hope of commissions while funneling most of any money made to the powerful heads of these schemes. Using aliases, fake websites, and made-up emails, “ghostwriters” are convincing unwitting Americans to pay tens and hundreds of thousands of dollars for writing services and a potential publishing deal. In total, hundreds of millions of dollars (if not more) have been lost.
The U.S. government has been pursuing action against “ghostwriting” plots similar to the one we wrote about in Pakistan; arrests were made earlier this year involving a scheme out of the Philippines. As a report in Bloomberg describes:
PageTurner is a subsidiary of an outsourcing company called Innocentrix Philippines. In December its founder and chief executive officer, a young globe-trotting fashionista named Michael Cris Traya Sordilla, was arrested by FBI agents while visiting his aunt in San Diego, alongside his business partner Bryan Navales Tarosa. The US Department of Justice charged them with pilfering a total of $44 million from more than 800 writers by employing “social engineering techniques to extract money under fraudulent pretenses,” according to the federal indictment.
Beyond arrests or further prosecution, the ghostwriting of memoirs has become somewhat of a cultural trend: last month, the Wall Street Journal reported that older rich people are spending tens or hundreds of thousands of dollars on memoirs hoping that will pass their wisdom to future generations.
With proven consumer interest in vanity memoirs and an older population that is less discerning online, the potential for successful fraud is ripe. Yet interest in cracking down on such fraud could now change as a result of the Trump administration’s recent diplomacy with Pakistan.
As the Financial Times reports this week, President Trump has been cozying up to Pakistan, who have offered up their country as a large hub for bitcoin mining and for the crypto industry in general. From the piece:
Officials say crypto and mining could help to fix Pakistan’s long-troubled economy, pathways to employ its youth and deliver fresh investment to free it from its mounting public debts. Pakistan has said it will create a “strategic” bitcoin reserve — modelled on the one established by Trump in March — and allocate 2,000MW of electricity towards cryptocurrency mining.
For a country with massive energy challenges that’s a flabbergasting offer to make for an unproven concept. But even more importantly: earlier this year, a Trump-backed crypto venture called World Liberty Finance (WLF) signed a “letter of intent” with the Pakistan Crypto Council, with an American envoy saying that Pakistan had “trillions of dollars” of mineral wealth “ripe for tokenization” (the U.S. is interested in Pakistan’s antimony, a mineral used in flame retardants and batteries). Trump and his affiliates reportedly hold a 60 percent stake in WLF.
Speaking of World Liberty Finance and its partnership with Pakistan—the Trump family’s crypto holdings as of Monday were worth $5 billion. This makes their holdings one of the most valuable Trump assets, worth far more than its real estate holdings. Monday began trading of the network’s cryptocurrency token, which is traded as $WLFI. The Witkoff family, who were the envoys signing the deal in Pakistan, controls 3.75 billion tokens.
In another FT piece from over the summer, Trump has claimed “massive oil reserves” in Pakistan—confusing experts who say that Pakistan’s “resource deals” with the United States have a lot of “smoke and mirrors” to them. A past recent exploration into purported Pakistani oil reserves found only a water reservoir—and according to the FT piece, “Pakistan produced about 66,000 barrels per day of crude last year, well below the output of Vietnam and neighboring India.” Many of Pakistan’s potential oil fields are centered in conflict-ridden areas without access for extraction.
Although there is skepticism that Pakistan actually has the oil that the U.S. claims—or the energy grid to mine bitcoin—the hype-before-reality playbook with Trump makes sense now given his business interests in crypto. Perhaps one of the winners at this juncture is a prominent Pakistani businessman—with a significant stake in the copper trade—who is implicated in the distribution of fentanyl to the United States, and is also linked to the ghostwriting scam.
It begs the question: what sort of large-scale financial fraud is able to continue, as diplomacy centers around the Trump family’s financial agenda and corruption?
A few things we’re reading…
In a critical antitrust case considering the break-up of Google, a federal judge ruled that Google must hand over its search data to competitors. But otherwise, Google seems to have avoided the worst of the potential outcomes, like being required to sell Chrome, which the government was pushing for. As Matt Stoller, an antitrust researcher and expert says, “Google won this round. And Wall Street is rejoicing.”
What happened to Builder.ai? A highly-valued AI company that saw a $30 million investment from Microsoft in 2023 went bankrupt in the last year.
A bleak statistic: gig drivers earn less in robotaxi markets like Phoenix, Austin, Los Angeles, and Phoenix.
The police wanted to find a man suspected of theft, so they tracked him down using facial recognition. The problem? The person they arrested wasn’t the actual suspect, but instead an Amazon employee who had an incredibly similar facial structure to the suspect.