A new ~$2.7 billion partnership between Donald Trump’s media empire, Trump Media & Technology Group (TMTG), and cryptocurrency giant Crypto.com, spearheaded by its controversial CEO Kris Marszalek, is igniting a firestorm of criticism from financial watchdogs. Concerns are mounting over Marszalek’s checkered business history and the potential for serious conflicts of interest as the firms plan to market cryptocurrency-based exchange-traded funds (ETFs) and other digital asset investments to retail investors.
A recent, scathing review by Americans for Financial Reform and Accountable.US pulls back the curtain on what they describe as Crypto.com’s deliberate strategy to cultivate ties with the Trump Presidency. This includes the suspicious move by Crypto.com to drop a lawsuit against a federal regulator shortly after Marszalek reportedly met with then President-elect Trump to discuss crypto policy – a meeting that preceded the announcement of this lucrative TMTG deal.
Critics are not mincing words, asserting that the Trump family has forged this alliance despite a history of “red flags” surrounding Crypto.com and, more specifically, its CEO, Kris Marszalek. His business past, they argue, is “replete with red flags,” with the company’s rapid ascent leaving even industry observers “perplexed.”
A History of “Unreliable” Leadership and Corporate Collapse
The spotlight shines brightest on Marszalek’s prior ventures, which paint a worrying picture of his leadership and reliability. A December 2022 CNBC report highlighted that Marszalek, who is based in Hong Kong, was once branded “unreliable” by a judge. He was also “involved [in] a multimillion-dollar settlement over claims of defective products” and, even more jarringly, received millions of dollars from his manufacturing company “months before it entered bankruptcy.”
This pattern of corporate distress and seemingly convenient exits is a significant point of concern. Prior to Crypto.com, Marszalek was at the helm of Ensogo, an e-commerce platform that ultimately collapsed in 2016, leaving customers and merchants in the lurch. His sudden resignation from Ensogo just weeks before its total shutdown is a detail critics are quick to emphasize.
MCO CRO
What was spun as a strategic “consolidation” by the company in August 2020 was, for many, a thinly veiled devaluation and a stark reminder of the inherent risks when a centralized entity controls a supposedly decentralized asset.
The MCO token, an ERC-20 standard cryptocurrency, was the original backbone of Crypto.com (then Monaco) – the very asset that funded its initial coin offering (ICO) in 2017. Holders of MCO were promised a suite of benefits, primarily through staking, to unlock the coveted tiered Visa cards with their attractive cashback rates and perks. This was the allure, the primary incentive for early investment.
Enter CRO, the Cronos Token. Positioned as the native currency of the burgeoning Crypto.com Chain, CRO was initially meant to complement, not replace, MCO. Users even received CRO airdrops, further cementing the idea of two distinct, yet symbiotic, tokens. This illusion was shattered with brutal efficiency in August 2020.
The announcement was swift and uncompromising: MCO was out, CRO was in, and the swap was mandatory. While a “bonus” was offered for early conversion and staking, the underlying reality was a forced exchange of a low-supply, utility-rich token for a high-supply token with a vastly different economic model. At a rate of 1 MCO to approximately 27.6 CRO (or 33.17 with the “bonus”), the move fundamentally diluted the proportional ownership of MCO holders in the Crypto.com ecosystem.
“It felt like a rug pull without actually being a rug pull,” one long-time MCO holder, who requested anonymity, told this publication. “We invested in MCO for specific card benefits, believing in its scarcity and the value proposition. To have it forcibly swapped for a token with a 100 billion supply, under the guise of ‘streamlining,’ was an insult to injury. The supposed ‘bonus’ was just a sweetener to make us swallow a bitter pill.”
Critics argue that the forced migration exposed Crypto.com’s centralized grip over its tokenomics. Despite MCO being an ERC-20 token on the Ethereum blockchain, theoretically offering a degree of decentralization, the company effectively rendered it useless within their ecosystem, forcing users onto their new, preferred token. This move highlighted the vulnerability of token holders when the issuing entity can unilaterally decide the fate of an asset.
Furthermore, the swap raised serious questions about transparency. There had been little to no prior indication that MCO would be completely abandoned. Many investors had diligently accumulated MCO to reach higher card tiers, only to find their goals suddenly shifted and made significantly more expensive in terms of dollar value required in the new CRO staking tiers.
While Crypto.com has since burned a significant portion of the CRO supply and continued to expand its services, the MCO-CRO saga remains a stain on its reputation. It serves as a cautionary tale for investors in the cryptocurrency space: a reminder that even ERC-20 tokens, when tied to a centralized platform, can be subject to the whims and strategic maneuvers of that platform. The MCO token, once a symbol of early adoption and loyalty to Crypto.com, became a testament to the risks of misplaced trust in a market that often champions decentralization but can, at times, deliver the exact opposite.
“Wash Trading” Allegations and Perplexing Growth
Beyond his past corporate failures, Crypto.com’s own meteoric rise has fueled suspicion. Fortune reported that Crypto.com saw its trading volume surge tenfold in 2024, a growth trajectory that “perplexed” industry watchers. One analyst even suggested the possibility of “‘wash trading’” to artificially inflate trading volumes or questioned the role of Crypto.com’s in-house trading team, raising critical conflict of interest risks.
“Using the Oval Office to make shady deals with crypto companies that line your own pockets appears to be a corruption crisis in the making,” declared Mark Hays, Associate Director for Cryptocurrency and Financial Technology at Americans for Financial Reform. “Crypto.com is a company of smoke and mirrors with luxury marketing campaigns and full of red flags; it’s consumers who will likely pay the cost for the Trump presidency’s participation in this self-enrichment scheme.”
Accountable.US Executive Director Tony Carrk added a direct challenge to congressional Republicans: “Congressional Republicans need to start asking direct questions about the gang of shady crypto players Donald Trump is increasingly conducting personal business with from his presidential perch, like what administration favors these special interests want in return, and what will it cost the American people?”
The implications of this partnership extend beyond financial risks. On May 6, Senator Richard Blumenthal (D-CT) launched an investigation into the $TRUMP cryptocurrency, citing concerns about potential ethics violations and transactions with foreign nationals under federal prosecution. Simultaneously, Democratic members of the House Financial Services Committee walked out of a planned hearing on crypto legislation, protesting the Republican refusal to address President Trump’s alleged crypto corruption and conflicts of interest.
As the Trump Media and Crypto.com collaboration moves forward, the persistent negative press surrounding Kris Marszalek’s past and the potential for political favors to influence financial markets ensure that this $2.7 billion deal will remain under intense scrutiny from watchdog groups and policymakers alike. Investors are urged to exercise extreme caution when considering investments tied to these highly controversial ventures.
