Congress Probes Secret $500M UAE Stake in World Liberty Financial Over National Security Risks
Decentralized finance (DeFi) and global politics are now at the center of attention in Washington. On February 4, 2026...
Quick overview
- Representative Ro Khanna has initiated an investigation into World Liberty Financial Inc. regarding a $500 million investment from a UAE royal family-controlled group.
- The inquiry focuses on potential conflicts of interest and the implications of foreign investments on U.S. technology policy, particularly concerning AI chip exports.
- Congress is demanding full documentation from WLF, including ownership verification and revenue transparency related to a $2 billion investment in Binance.
- The outcome of this investigation could lead to stricter regulations for decentralized finance projects and stablecoin issuers in the U.S.
Decentralized finance (DeFi) and global politics are now at the center of attention in Washington. On February 4, 2026, Representative Ro Khanna (D-Calif.), who leads the House Select Committee on U.S.-China competition, started a formal investigation into World Liberty Financial Inc. (WLF).
The investigation focuses on a previously hidden $500 million investment from a group controlled by the United Arab Emirates (UAE) royal family. This deal was signed only four days before President Trump’s second inauguration.
The “Spy Sheikh” and the $500 Million Stake
The main focus of the inquiry is Aryam Investment 1, a company connected to Sheikh Tahnoon bin Zayed Al Nahyan, who is the UAE’s National Security Adviser and the President’s brother. Known as the “Spy Sheikh,” Tahnoon manages a large investment network, including AI companies G42 and MGX.
The committee’s findings show the following:
- The Deal: Aryam Investment bought a 49% share of WLF for $500 million.
- The Payout: The first $250 million was paid right away, and $187 million reportedly went to Trump family businesses.
- The Timing: The deal was completed on January 16, 2025, just before the new U.S. administration took office.
Connecting the Dots: Stablecoins, Binance, and China Policy
The investigation is not just about conflicts of interest. It also looks at how technology competition with China plays a role. In a letter to WLF co-founder Zach Witkoff, Representative Khanna points to a complicated set of transactions involving the company’s USD1 stablecoin.
In March 2025, MGX, a company linked to the UAE, used $2 billion in USD1 stablecoins to invest in Binance.
Since Binance started in China and has often been questioned about its connections there, Congress worries that WLF could be helping foreign interests bypass U.S. export controls.
National Security Implications: The AI Chip Link
One main question in the investigation is whether this private investment led to a major change in U.S. technology policy. Soon after the WLF deal, the Trump administration approved a debated license that let the UAE import hundreds of thousands of advanced AI chips, including those from Nvidia.
Before this, these exports were limited because of concerns that the technology might end up in the People’s Republic of China (PRC). Khanna’s letter says the President’s family’s financial interests may have “subordinated robust policy discussions” about national security.
What Congress is Demanding
The House Select Committee has asked WLF to provide full documentation by March 1, 2026. They want the following items:
- Verification of Ownership: Complete records of the 49% stake purchase by UAE groups.
- Board Influence: Information about board appointments for Peng Xiao (CEO of G42) and Martin Edelman, both connected to Sheikh Tahnoon.
- Revenue Transparency: Records of all profits from the $2 billion Binance deal.
- Policy Communications: Any records of talks with federal agencies about export licenses for AI chips to the UAE.
“Our ability to successfully outcompete the Chinese Communist Party depends on the integrity of our policymaking process,” stated Ro Khanna. “Congress will not be supine amid this scandal.”
The Road Ahead for WLF and Crypto Regulation
WLF spokespeople have called the allegations “fact-free suggestions” and described the scrutiny as “un-American” interference in a private business. Still, the investigation marks a new phase of oversight for the crypto industry.
If the investigation shows that foreign money was used to sway federal tech policy, it could result in tougher CFIUS (Committee on Foreign Investment in the United States) reviews for DeFi projects and stablecoin issuers.
For crypto markets, the results of this investigation could decide how regulators treat “politically connected” tokens and whether the USD1 stablecoin can keep its role as a cross-border settlement tool.
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