Nasdaq's Rule Enforcemenț Shakes Trump's Crypto Grip

Nasdaq’s listing rules have prompted a significant governance change at ALT5 Sigma, a company affiliated with the Trump family's latest cryptocurrency initiative, World Liberty Financial (WLFI). Eric Trump, the second son of former U.S. President Donald Trump, has been removed from the ALT5 board of directors. The decision followed discussions with Nasdaq Stock Market LLC and was made to ensure compliance with its listing standards.

According to an SEC filing, the removal of Eric Trump from the board was a necessary adjustment after his appointment raised questions about adherence to Nasdaq’s requirements. While the specific rule triggering the change remains undisclosed, one possible factor is the requirement that a majority of board members at listed companies be independent. Eric Trump’s position was subsequently replaced by Zak Folkman, the COO and co-founder of World Liberty Financial, who was appointed as a director to fulfill the requirement.

The change marks a pivotal development for ALT5 Sigma, particularly as it seeks to raise $1.5 billion through direct and private share sales. The funds will be used to purchase digital tokens from World Liberty Financial, a DeFi project that has attracted considerable attention since its launch. Eric Trump initially joined the board as part of the deal, while Folkman took on the role of board observer. However, the SEC filing now confirms that Folkman has been elevated to a full director position, replacing Eric Trump.

Despite the board change, the Trump family maintains a significant stake in WLFI. A Trump-affiliated LLC owns approximately 38% of WLFI and an impressive 22.5 billion tokens, granting the family considerable influence within the project. With about 75% of token-sale proceeds reportedly under their control, the Trumps’ involvement in the project remains robust.

The governance shift at ALT5 Sigma coincides with a broader period of volatility for the WLFI token. Over the past month, the token has experienced significant price fluctuations. It reached a peak of $0.33 during its presale but has since fallen to $0.1962, representing a 30% decline from its high. In the last 24 hours alone, WLFI dropped 6.92%, raising concerns among investors about its short-term prospects.

The token’s performance has been further complicated by allegations of market manipulation and the blacklisting of 272 wallets—among them, one belonging to major investor Justin Sun. These actions, while intended to stabilize the market, have also sparked criticism from the crypto community, with some arguing that they undermine the principles of decentralization.

Despite these challenges, some analysts remain cautiously optimistic. They suggest that a resurgence in buying pressure or a shift in broader market sentiment could drive WLFI’s price higher. Technical indicators, including the Chaikin Money Flow and Moving Average Convergence Divergence, currently point to bearish conditions, but a reversal could signal a potential recovery.

ALT5 Sigma’s recent governance adjustments underscore the delicate balance between compliance and influence in the rapidly evolving crypto market. As the project moves forward, it will need to demonstrate both financial resilience and a commitment to decentralized governance to regain investor confidence. For now, the market is closely watching how the Trump family, World Liberty Financial, and Nasdaq navigate this complex landscape.