US Democrat lawmakers have sent a letter to the US Treasury demanding access to suspicious activity reports (SARs) on several Trump-backed crypto projects as part of the latest probe into the president’s digital ventures. 

Penned by representatives Gerald Connolly, Joseph Morelle, and Jamie Raskin, the May 14 letter asks Treasury Secretary Scott Bessent for all SARS filed since 2023 related to World Liberty Financial (WLF) and the Official Trump (TRUMP) token. 

Financial institutions in the US must file SARs with the Financial Crimes Enforcement Network, a bureau within the Department of the Treasury, when they detect suspicious activity, including potential money laundering or fraud. 

Source: Oversight Committee Democrats

The sweeping probe asks for any SARs mentioning WinRed, America PAC, Elon Musk, political action committee, PAC, Trump, World Liberty Financial, WLF, TRUMP, MELANIA and Justin Sun, no later than May 30. 

The Democratic lawmakers say their probe is to “determine whether legislation is necessary to prevent violations of campaign finance, consumer protection, bribery, securities fraud, and other anti-corruption laws” and to guard against “financial misconduct connected to prospective or current federal officials.” 

Democrats argue WLF and Trump coin could be misused

As part of the letter, the lawmakers argue WLF could be misused as a “vehicle for foreign influence peddling” because it served part of its token sale for foreign investors, who are “generally subject to less stringent regulation than US investors.” 

Justin Sun’s investment in WLF and the subsequent pause of the SEC’s lawsuit that alleged the crypto entrepreneur broke securities laws has also been flagged as a concern. 

Trump’s token has come under fire as well because the lawmakers argue in their letter that the identities of the coin purchasers are not publicly disclosed, which could open the door for bad actors to “curry favor with Trump” by purchasing the coin. 

At the same time, SARS related to Republican digital fundraising WinRed, Elon Musk’s super PAC, which poured $250 million into Trump’s election campaign, and two other PACs are being sought. 

Related: Trump-owned Truth Social denies it is launching a memecoin

This effort is the latest Democrat-led salvo against Trump’s crypto ventures.  

A group of Democratic senators reportedly sent a letter to leadership at the US Department of Justice and the Treasury Department expressing concerns about Trump’s ties to crypto exchange Binance and potential conflicts of interest in regulating the industry, according to a May 9 Bloomberg report. 

US Democratic lawmakers also launched a multi-angle attack on May 6, targeting Trump’s ability to profit from his crypto initiatives with two bills and a subcommittee inquiry. 

Magazine: Trump’s crypto ventures raise conflict of interest, insider trading questions

Too many crypto startups are pricing themselves out of venture capital funding by chasing valuations far exceeding their revenues, according to Dan Tapeiro, the CEO of crypto-focused venture capital firm 10T Holdings.

“For some reason, founders and CEOs think that they should be raising capital at 50 to 80 times revenue. So that makes it very hard for us to make a return for our liquidity providers,” Tapeiro said while speaking in a panel discussion at the Consensus conference in Toronto on May 14.

“So a lot of those deals we just pass almost automatically, even businesses that we really like, we won’t invest in if the price isn’t reasonable in the beginning.”

10T Holdings has passed on over 200 companies for similar reasons, including the now-bankrupt FTX, BlockFi and Celsius, Tapeiro said. 

Tapeiro said 10T Holdings looks for crypto projects that have valuations above the $400 million to $500 million range with a valuation-to-revenue ratio of 10x or less.

Host of Crypto In America Eleanor Terrett (left) moderating a discussion with Pantera Capital CEO Dan Morehead (middle) and Dan Tapeiro (right) at the Consensus conference. Source: Cointelegraph

VCs often prefer lower valuations because they offer more upside potential with less risk.

Realistic valuations often make follow-on funding rounds more attractive to investors while also simplifying the exit process.

“Valuation is very important,” Tapeiro said.

Despite Tapeiro’s comments, it appears that crypto startups have had no problem attracting VC funds, as PitchBook reported on May 13 that the total value of crypto venture capital deals rose over 100% quarter-on-quarter to $6 billion in Q1 2025, while the number of deals only increased by 8.8%.

VCs should diversify their bags

Also speaking alongside Tapeiro was Pantera Capital CEO Dan Morehead, who said more VCs should opt to receive a mix of private equity and tokens when investing in crypto startups.

“Each one has their pros and cons, and then they go in these wild pendulum swings where sometimes tokens are really expensive and ventures cheap. Sometimes it’s the opposite.”

Related: Crypto VC deals drop in Q1, but funding more than doubles: PitchBook

“So as an investor, I always advocate people investing in a wide spectrum of tokens and ventures.”

Morehead’s Pantera has taken a more aggressive approach than 10T Holdings over the years and seen considerable success, making a return on 86% of the startups it invested in, with 22 of those reaching unicorn status (companies reaching $1 billion valuations).

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Crypto and stock trading platform eToro has seen its share price gain nearly 30% during its debut on the Nasdaq after the company made a last-minute boost to its initial public offering.

Shares in eToro Group Ltd (ETOR) closed May 14 trading at $67, up 28.9% from its initial offering price of $52, according to Yahoo Finance. It brings the company’s market value to over $5.5 billion.

Its stock price shot to a high of $74.26 during the trading day before cooling and has also slightly dipped by 0.7% after the bell to $66.53.

EToro shares shot up and then traded sideways on the company’s debut US offering. Source: Yahoo Finance

The day before, on May 13, eToro boosted its IPO to $620 million after pricing its shares above its previously suggested range of between $46 to $50 each. 

Initially, the firm aimed to raise $500 million by offering 10 million shares, but the company and its backers sold over 11.92 million shares at its IPO, split evenly between eToro and some existing shareholders.

Some BlackRock-managed funds and accounts had signalled interest in buying up to $100 million worth of shares at IPO, eToro said in a May 5 filing with the Securities and Exchange Commission.

Robinhood Markets Inc. (HOOD), a rival to eToro that went public in 2021, saw its share price sink 1.9% to $61.39, with its losses extending by 1.63% after-hours to $60.39, Yahoo Finance shows.

In its regulatory filing, eToro reported its total 2024 crypto revenue, from sources such as trading fees and withdrawals, was $12.1 billion, up from $3.4 billion in 2023. It also expected crypto to account for 37% of its commission from trading activity in the first quarter of 2025, down from 43% in Q1 2024.

The offering was led by Goldman Sachs, Jefferies, UBS Investment Bank and Citigroup.

IPOs rebound after tariff turmoil 

EToro’s public debut marks a rebound for public offerings in the US after many firms put their plans on hold as US President Donald Trump’s sweeping tariffs tanked global markets.

EToro made confidential filings with the SEC in January for a public offering and publicly announced the plans on March 24, but delayed its IPO after Trump’s April 2 “Liberation Day” tariff plans, which put a stop to many in-the-works public offerings.

Related: 8 major crypto firms announce US expansion this year 

The stock and crypto trading house was founded in 2007 and previously bid to go public in 2021 via a merger with a special purpose acquisition company at a valuation of $10 billion.

It canned that plan a year later, in 2022, after stock and crypto markets took a massive hit due to the COVID-19 pandemic and sticky inflation that caused central banks to quickly hike interest rates.

Crypto exchange Kraken is considering going public this year, as is stablecoin issuer Circle, which filed with the SEC on April 1 but paused its plan a day later due to Trump’s tariffs.

Crypto fund manager Bitwise predicted in December that, alongside Kraken and Circle, crypto exchange Figure, crypto bank Anchorage Digital and blockchain analytics firm Chainalysis would also go public this year.

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