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Four days before Donald Trump took the oath of office for his second term, a powerful Emirati official wired $250 million into Trump family bank accounts. The official, Sheikh Tahnoon bin Zayed Al Nahyan, serves as the UAE’s national security advisor and controls sovereign wealth funds worth hundreds of billions of dollars. The money represented the first installment of a $500 million investment in World Liberty Financial, a cryptocurrency venture that the Trump sons had launched months earlier. Of that initial payment, $187 million went directly to Trump family entities, with another $31 million flowing to relatives of Steve Witkoff, the newly appointed Middle East envoy. The remaining $32 million went to other investors and operational expenses.
Ten months later, the administration authorized the export of approximately 500,000 advanced artificial intelligence processors to the United Arab Emirates. The processors approved for export—primarily NVIDIA H100 accelerators and comparable devices—represent some of the most powerful AI computing technology available anywhere in the world. They enable training of frontier AI models, the computational backbone of systems like ChatGPT and Claude. The previous administration had refused to approve similar exports, citing documented concerns about technology transfers to China.
Did a foreign government buy access to restricted American technology by investing in the president’s family business?
Export Controls and Strategic Technology
The United States maintains an elaborate system—the Export Administration Regulations—designed to keep advanced AI chips out of the hands of adversaries. The system dates to the Cold War, when preventing Soviet access to advanced Western technology represented a strategic imperative. Over decades, the framework evolved to address technologies that have both civilian and military uses.
Advanced AI chips occupy the most sensitive category within this system. The same processor that trains a language model for customer service can train targeting systems for autonomous weapons. The same computational power that enables medical imaging analysis can enhance surveillance capabilities or cyberattack tools. Only a handful of companies worldwide can manufacture the most advanced chips. They require access to specialized manufacturing equipment (extremely precise machinery that uses extreme ultraviolet light) that costs $150 million each and takes years to build. The United States exercises disproportionate leverage over global AI development by controlling who can buy these processors.
The Biden administration built its AI export policy around this leverage. A new rule about sharing AI technology, finalized days before the transition, created a tiered system. Close allies got relatively unrestricted access. Major trading partners could import significant quantities under security requirements. Adversaries like China faced near-total prohibitions. The UAE fell into the middle tier because of specific, documented concerns about technology leakage to China.
The China Connection
In 2022, U.S. intelligence agencies collected information suggesting that G42—the UAE’s flagship AI company and the intended recipient of American chips—had provided flight software technology to Huawei, the Chinese telecommunications giant heavily involved in Chinese military modernization. That technology allegedly ended up in Chinese air-to-air missile systems. Intelligence agencies had collected evidence of deliberate technology transfer from a UAE company to a U.S.-sanctioned Chinese entity for military purposes.
G42’s ties to China ran deeper than a single incident. The company had held equity stakes in ByteDance, TikTok’s parent company. It had partnered extensively with Chinese firms to build smart city infrastructure across the Gulf. Abu Dhabi had become an early adopter of Chinese 5G technology and maintained close commercial relationships with companies like Huawei and ZTE—relationships that persisted even as Western nations grew increasingly wary.
From a strategic perspective, the Biden administration’s caution made sense. The Emirates had demonstrated a consistent pattern: maintain partnerships with both the United States and China, extract maximum benefit from both relationships, and let technology flow where commercial incentives led. Providing advanced AI chips to a country with documented technology transfer problems wasn’t prudent risk management. The new administration reversed this assessment within months of taking office.
The Investment Structure
World Liberty Financial launched in October 2024 as a cryptocurrency lending service that operates without a central company controlling it. By the time the second term began, the company had virtually no products beyond a token sale that had raised $550 million from various investors. Yet Trump entities secured roughly a $5 billion windfall when trading of World Liberty Financial’s token opened to the public.
Sheikh Tahnoon’s investment occurred on January 16, 2025. The $500 million total was split: half paid immediately, the remainder due by July 15, 2025. The initial $250 million payment was allocated so that $187 million went to two Trump family entities—DT Marks DEFI LLC and DT Marks SC LLC. Approximately $31 million went to entities affiliated with Witkoff and his family members. This arrangement gave the Emirati national security advisor control of nearly half the cryptocurrency company while placing nearly two hundred million dollars directly into Trump family accounts at the precise moment the presidency was assumed.
The investment remained secret until February 2026, when the Wall Street Journal published detailed reporting based on undisclosed corporate documents. A massive financial transfer from a foreign government official to the incoming president’s family business was conducted in complete opacity.
In May 2025, MGX—another Emirati sovereign wealth fund also chaired by Sheikh Tahnoon—announced a $2 billion investment in the cryptocurrency exchange Binance. The investment would be structured using World Liberty Financial’s USD1 stablecoin, which the company had launched weeks earlier. This maneuver provided World Liberty Financial with $2 billion in cash reserves (generating roughly $80 million annually in interest income) and vaulted USD1 into the ranks of the world’s largest stablecoins nearly overnight.
The Foreign Emoluments Clause
The Constitution states that no person holding office under the United States “shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.” The Framers inserted this clause specifically to prevent foreign governments from acquiring influence over American officials by directing financial benefits their way.
Applied to the World Liberty Financial investment, the constitutional analysis is straightforward. Sheikh Tahnoon is unquestionably acting on behalf of a foreign state—he serves as the UAE’s national security advisor and controls sovereign wealth funds. The $187 million that flowed to Trump family entities constitutes money given by a foreign government. Congress never gave consent to receive the money.
The White House contests this analysis, arguing that no conflict exists because “President Trump’s assets are in a trust managed by his children.” This echoes the position taken during the first term, when divestment from the business empire was similarly refused and instead a “blind trust” managed by adult sons was created.
Constitutional scholars have been sharply critical of this framework. A trust where someone other than the president makes all business decisions without telling the president what’s happening operates with an independent trustee. The arrangement in question has been described by observers as only called a blind trust in name, since money can still be withdrawn from businesses and family members who manage the trust remain subject to influence.
The question of whether the Foreign Emoluments Clause was violated during the first term reached federal courts, with three separate lawsuits filed by members of Congress, state attorneys general, and ethics watchdog organizations. Lower courts were sharply divided on the constitutional questions involved. The Supreme Court avoided ruling on the actual legal questions by saying the cases were no longer relevant once the first term ended. The law remains in a state of significant uncertainty, and the failure to litigate these constitutional questions means that “a president who anticipates serving only one term” can run out the clock on any legal challenges.
The Scale of the Export
Five hundred thousand advanced AI processors represents an enormous quantity of computational power. The NVIDIA H100 chips approved for export are among the most powerful AI accelerators available in the global market. These processors enable training of extraordinarily large language models with billions of parameters—the kind of computational capability that forms the foundation of modern generative AI. They also enable rapid inference at scale, allowing organizations to serve millions of users simultaneously.
When accumulated in large quantities, these processors form the basis of massive computational clusters capable of training the world’s most advanced AI models. The administration approved these exports for use in large-scale data center projects, most notably the Stargate UAE initiative announced in May 2025. This project, developed in partnership with OpenAI, Oracle, SoftBank, and other major technology firms, is designed to create 1 gigawatt of computational capacity for AI training and deployment in Abu Dhabi. When fully operational, this facility would constitute among the world’s largest AI computing complexes, giving the Emirates the ability to independently train the most advanced AI models.
The possession of such massive computational capacity in a country with documented ties to China, combined with the demonstrated willingness of Emirati technology companies to facilitate technology transfers to Chinese partners, creates a potent vector for sensitive AI technology to reach Beijing.
Administration officials point out that G42 has made public commitments to decouple from Chinese technology and has undergone extensive security reviews by U.S. firms including Microsoft, one of G42’s major investors. They emphasize that Microsoft has personally verified the removal of Chinese hardware from G42 data centers and has implemented military-grade security protocols. However, once a country is deeply using American technology, it becomes expensive and difficult to switch to something else.
The rapid reversal of the UAE chip export policy, occurring almost immediately upon a change in administrations, raises questions about the reliability of such lock-in strategies. If one administration can reverse course due to financial benefits accruing to sitting officials, then foreign governments may reasonably conclude that today’s generous technology access could become tomorrow’s restrictions.
Congressional Response
Senator Elizabeth Warren characterized the arrangement as “corruption, plain and simple” and called for testimony from administration officials regarding whether they had compromised national security to line their own pockets. Warren urged the administration to reverse its decision to sell advanced AI chips.
Senator Chris Murphy alleged on social media that the deal represented “mind blowing corruption,” while Senator Chris Van Hollen accused foreign countries of “bribing our president to sell out the American people” through the combination of the cryptocurrency investment and the chip export authorization. House Democrats demanded investigations. Representatives Gregory W. Meeks, Gabe Amo, and Robert Garcia sent a letter requesting that the Inspectors General of the Commerce and State Departments investigate potential conflicts of interest and ethics violations by Steve Witkoff.
The structure of the arrangement—in which a foreign government official makes a massive investment in a family venture, and months later the administration approves a historically significant technology transfer to that same country—presents a classic case of one side doing something in exchange for money from the other side. Public Citizen issued a statement arguing that the deal “violates the constitutional rule against foreign governments paying American officials, the most basic ethics standards and plain common sense.”
From an enforcement perspective, congressional options are limited. Congress could theoretically seek to subpoena witnesses, demand testimony, or initiate impeachment proceedings. But the current Republican majority in both chambers has shown limited appetite for aggressive oversight. Legislation clarifying and strengthening the Foreign Emoluments Clause could be passed, but such legislation would likely face a veto.
The administration has responded to congressional criticism by insisting that the chip export approval was made purely on national security and strategic grounds, without any influence from personal financial interests. White House Counsel David Warrington stated that “the President has not participated in any commercial transaction that could implicate his constitutional duties.” These denials don’t address the fundamental structural problem. When foreign governments can invest hundreds of millions of dollars directly into the personal or family businesses of sitting American officials, and when technology export decisions favorable to those same foreign governments follow within months, the appearance of a quid pro quo becomes nearly impossible to dispel.
As Robert Weissman, co-president of Public Citizen, framed it: “Maybe the President would have reached the same decision over the transfer of advanced technology if he wasn’t also getting money from them. But we’ve got no way to know that, and we do know there was a lot of opposition inside the government to do exactly what he has OK’d.”
Broader Export Control Liberalization
The chip export approval represents part of a broader pattern of export control liberalization that has alarmed national security experts. In December 2024, a major policy shift was announced, directing that certain advanced AI chips—specifically the NVIDIA H200 and AMD MI325X processors—would be permitted for export to China on a case-by-case basis with appropriate security safeguards. This announcement shocked many observers who had assumed that the most stringent restrictions would be maintained.
The stated rationale was that older-generation chips now commercially available in the United States should be exportable to approved customers in China, provided certain security requirements were met. Critics argued that even older-generation chips represented a substantial capability enhancement for Chinese AI development and that the policy represented a dangerous erosion of America’s technological competitive advantage.
This represents a fundamental shift in how export controls function. For decades, the system operated on the principle that sensitive technology should be restricted by default, with exceptions granted only after careful security review. The new approach has inverted this logic: technology should be exportable by default, with restrictions imposed only when specific, immediate threats can be documented.
Export controls only work if other countries believe they’re based on real security concerns rather than fluctuating political considerations or personal financial interests of government officials. If foreign governments can invest in American political ventures or await a favorable election cycle to overcome export restrictions, then the restrictions become little more than temporary impediments rather than durable guardrails on sensitive technology.
Export Controls and Official Conflicts of Interest
Export controls function by limiting access to critical items and technology, creating leverage that policymakers can exercise to shape the behavior of other nations. This leverage depends on the credibility and consistency of American resolve—other nations must believe that the United States will enforce its controls and that export restrictions reflect genuine national security concerns.
The rapid reversal of policy creates a credibility problem for future export control regimes. Other nations that face restrictions can now reasonably conclude that those restrictions may be reversed if sufficient financial inducements are provided to relevant American officials. This makes other countries less likely to respect American export restrictions in the future.
Consider the message this sends to China. The United States has constructed elaborate export controls specifically designed to prevent China from acquiring advanced semiconductor technology that could accelerate Chinese military AI development. Yet if the administration is willing to export advanced chips to a country with demonstrated ties to China, in part because that country’s leaders have invested in family business ventures, then the credibility of American AI chip controls is substantially diminished. China can reasonably conclude that American export policy is for sale, and that the path to accessing restricted technology runs through family businesses rather than through diplomatic channels or security assurances.
G42 and other Emirati technology companies maintain ongoing relationships with Chinese entities despite recent public pledges of decoupling. The Emirates remain a major hub for Chinese technology investment and commercial activity. Export controls cannot physically prevent technology transfer if the importing nation is determined to transfer it onward. Controls can only create friction and risk that discourage or prevent such transfers. When the controls themselves become subject to negotiation through financial arrangements with sitting officials, that friction disappears.
Conflict-of-Interest Solutions
There exists a straightforward solution to this entire category of problems: presidents should divest from their business holdings upon taking office, or at minimum place them in genuinely independent trusts managed by parties with no family or financial connections to the official.
Presidents have historically adopted aggressive conflict-of-interest avoidance strategies. Barack Obama divested entirely from potentially problematic business holdings. Jimmy Carter placed his peanut farm in a blind trust managed by an independent trustee. The norm, until recently, was that presidents understood their obligation to avoid even the appearance of conflicts between their official duties and their private interests.
The Brennan Center for Justice and other governance watchdogs have argued that Congress should pass legislation that definitively addresses these issues. Such legislation could clarify that the Foreign Emoluments Clause applies to money received through business entities and foundations over which a president exercises substantial influence. Legislation could also eliminate the “blind trust” loophole by requiring genuinely independent trustees with no family or other connections to the official in question. Congress could establish clear procedures for conflict-of-interest screening of export licensing decisions and require transparency in export licensing decisions, including annual reporting on major approvals and the rationales underlying them.
Yet such legislative protections remain unrealized. During the first term, no such legislation passed despite the various emoluments-related controversies that arose. During the intervening years under the Biden administration, no major legislation was enacted to close these gaps. With Republicans controlling both chambers of Congress during the second term, the prospect of legislation constraining a Republican president’s business activities appears remote.
The Outcome
Authorization has been received to import advanced AI chips, and the Stargate UAE data center project and other AI infrastructure investments are proceeding. These will firmly entrench American technology at the center of Emirati artificial intelligence capabilities. Whether that technology will remain insulated from Chinese access, as the administration has asserted, or will eventually flow to Chinese partners through G42’s networks, as skeptical observers warn, remains an open question.
Export controls are supposed to prevent sensitive technology from reaching adversaries based on national security calculations, not based on which foreign governments have invested in the president’s family businesses. When those two considerations become intertwined, the export control system stops functioning as a national security tool and becomes instead a mechanism for extracting financial benefits from foreign governments in exchange for access to restricted American technology. That’s what export controls become when the people enforcing them have a financial stake in approving the exports.
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