Eric Trump's Crypto Board Seat Vanishes! Here's What Happened.
Eric Trump's brief stint on the board of a cryptocurrency firm has come to an abrupt end. Just weeks after Alt5 Sigma, a fintech company, announced that the former President's son would be joining its board of directors, the company revealed a change in plans following discussions with Nasdaq.
On August 13th, Alt5 Sigma trumpeted Eric Trump's appointment in a press release. Trump even rang the Nasdaq opening bell that day to celebrate a $1.5 billion crypto deal between Alt5 Sigma and World Liberty Financial, a company financially backed by the Trump family. However, a Securities and Exchange Commission (SEC) filing revealed that Trump has been relegated to the role of a board observer. This means he can attend meetings but lacks the power of a full board director.
According to the SEC filing dated August 25th, the change was made "after discussion with The Nasdaq Stock Market LLC" and "in order to comply with Nasdaq’s listing rules." The company has not provided further explanation, and Eric Trump is still listed as a board director on Alt5 Sigma's website. Zachary Witkoff, the son of President's Middle East envoy Steve Witkoff, has been named chairman and board nominee of Alt5 Sigma.
Alt5 Sigma announced in August that it would raise $1.5 billion through direct and private sales of its shares and use the proceeds to buy digital tokens from World Liberty Financial, a crypto startup whose cofounders include Donald Trump and his three sons. As part of the deal, Alt5 Sigma said “Eric Trump will become a director on its board of directors” and World Liberty Financial COO and fellow co-founder Zak Folkman would join as a board observer.
Two weeks later, Alt5 Sigma disclosed in an SEC filing that, after discussions with Nasdaq, to comply with its listing rules, Trump would instead be a board observer and, subject to stockholder approval, Folkman would be appointed as a director.
The specific Nasdaq rule that triggered the change remains unclear, and neither Alt5 Sigma, World Liberty Financial, nor Eric Trump have commented on the matter. A Nasdaq spokesperson also declined to comment.
Possible Reasons Behind the Change
The SEC filing indicates that the change was made "after discussion with The Nasdaq Stock Market LLC (‘Nasdaq’)", which suggests Nasdaq's rules played a role. However, without further clarification from the involved parties, the exact reason for Eric Trump's demotion remains a mystery.