Donald Trump sold a $500m (£360m) stake in his crypto empire to an Abu Dhabi royal known as the “spy sheikh” just days before the US presidential inauguration.
Sheikh Tahnoon bin Zayed Al Nahyan, the brother of Mohamed bin Zayed Al Nahyan, the president of the United Arab Emirates, reportedly agreed a secret deal to purchase a 49pc stake in World Liberty Financial last year.
The first instalment of the deal, which was signed off by Eric Trump, the US president’s son, was $250m, of which $187m was channelled to Trump family entities.
At least $31m was directed to the family of Steve Witkoff, a World Liberty co-founder and Trump’s special envoy to the Middle East. A further $31m was sent to an entity linked to other co-founders Zak Folkman and Chase Herro, The Wall Street Journal reported.
While Mr Trump has sought to broker business deals while in office and even accepted gifts from foreign governments, including a $400m jetliner from Qatar, the deal is the only known example of a foreign government official taking a major stake in a US president’s company.
Sheikh Tahnoon is the deputy ruler of the UAE and oversees Abu Dhabi’s $1.3tn sovereign wealth fund, making him one of the most powerful individual investors in the world. He is also known as the “spy sheikh” owing to his role as national security adviser.
The Abu Dhabi royal, who has connections with the Silicon Valley elite and works out with Mark Zuckerberg, has long sought access to US-made artificial intelligence chips. However, efforts were largely resisted by Joe Biden’s administration because of concerns the technology could end up in Chinese hands.
But just months into Mr Trump’s second term in office, the US government agreed to give the Gulf state access to 500,000 of the most advanced AI chips per year. Around a fifth of these chips will be offered to Sheikh Tahnoon’s own AI firm G42.
Donald Trump’s government agreed to give the UAE access to 500,000 of the most advanced AI chips each year – Daniel Torok/White House/American Photo Archive/Alamy
Meanwhile, MGX, a fund chaired by Sheikh Tahnoon, now has a 15pc stake in US TikTok after the social media company’s American operations were taken over by a consortium of bidders backed by Mr Trump.
The secret deal will raise fresh questions about the Trump family’s business dealings through World Liberty Financial.
The company, a decentralised finance platform that offers its own stablecoin, has been subject to intense scrutiny over conflict-of-interest concerns.
An SEC fraud investigation into Chinese crypto tycoon Justin Sun was dropped after he invested tens of millions of dollars into World Liberty last year.
Another Tahnoon-linked investment firm last year used World Liberty’s stablecoin to carry out a $2bn investment in Binance. The cryptocurrency exchange’s founder Changpeng Zhao, who was imprisoned for violating money laundering laws, was subsequently pardoned by Mr Trump.
The stake sale to Tahnoon’s Aryam Investment makes the Abu Dhabi company the largest shareholder in World Liberty. Two Aryam executives have also taken seats on World Liberty’s board, alongside Eric Trump and Zach Witkoff, Steve Witkoff’s son.
It is not clear how the second half of the $500m investment, which was due by July, has been distributed.
The deal underscores the growing involvement of the UAE in Western politics. RedBird IMI, a fund majority backed by Abu Dhabi, was blocked from buying The Telegraph after an outcry over press freedom prompted the Government to introduce new laws banning foreign state ownership of British newspapers.
Sheikh Tahnoon is also providing backing for Paramount’s hostile $108bn takeover bid for Warner Bros, the Hollywood studio giant behind Harry Potter.
David Wachsman, a spokesman for World Liberty, told The Telegraph that neither Mr Trump nor Mr Witkoff were involved in the deal and had not been involved in World Liberty since taking office.
He added: “Any claim that this deal had anything to do with the administration’s actions on chips is 100pc false. The Left-wing media is dishonestly pushing baseless innuendo in an effort to deceive the public and smear our company.
“As a private business, we operate by the same rules and regulations as any other company in our space, do not want or receive any special treatment, and reject the fact-free suggestions to the contrary.”
A Trump Organization spokesman said the company “takes its ethical obligations extremely seriously and is deeply committed to preventing conflicts of interest” and abides by all applicable laws.
A person close to Sheikh Tahnoon told the newspaper that the sheikh and his team had reviewed the deal for several months before making the investment. They added: “At no time during that due diligence or thereafter was the investment discussed with President Trump.”
