How Trump’s Crypto Business Partners Left Their Old Clients in the Lurch
By Lawrence Delevingne
BOSTON, May 19, 2025 (Reuters) — A recent investigation reveals how business partners associated with former President Donald Trump have abandoned their previous clients following a significant hacking incident that impacted a cryptocurrency trading platform known as Dough Finance.
The Fallout from Dough Finance
Last summer, Jonathan Lopez, a Miami-based investor and motivational speaker, invested approximately $1 million in Dough Finance, a platform that facilitated risky trading strategies using borrowed cryptocurrencies. Dough’s unique feature, “looping,” allowed traders to leverage their crypto holdings for further investments, amplifying both potential gains and risks. Initially, Lopez found success, encouraged by the platform’s co-founder Chase Herro, who personally supported him in navigating the intricacies of the trading landscape.
However, disaster struck on July 12, 2024, when hackers infiltrated Dough, stealing around $2.5 million. In a post-mortem report released by Dough on July 23, the company acknowledged vulnerabilities in its code and expressed regret over the incident, pledging to enhance security measures. Two months after the hack, Herro and fellow co-founder Zak Folkman emerged with a new venture: World Liberty Financial, now partnered with Donald Trump and his sons.
New Ventures with Trump
Following the hacking incident, Herro and Folkman transitioned swiftly to World Liberty Financial, where they found support from President Trump, who assumed the role of “Chief Crypto Advocate.” The Trumps were introduced to the pair by Steve Witkoff, a U.S. envoy in the Middle East. Their partnership with the Trump family has proven lucrative, with Herro and Folkman reportedly earning at least $65 million from World Liberty’s operations, which includes the sale of over $550 million in tokens.
Lopez, meanwhile, has initiated legal proceedings against Herro, claiming fraud, misrepresentation, and breach of fiduciary duties. In his lawsuit, filed in January, he seeks restitution, punitive damages, and legal fees, arguing that he invested heavily in Dough based on Herro’s assurances.
Legal Battles and Reactions
Herro’s legal team has requested that the case be dismissed or sent to arbitration, asserting that Lopez was a “sophisticated” investor who should have recognized the inherent risks of such investments. A trial date has been set for April 2026 in Miami federal court. In a statement regarding the situation, Eric Trump, executive vice president of the Trump Organization, expressed pride in the World Liberty team, asserting they had exceeded expectations in their endeavors.
Though neither Herro nor Folkman responded to inquiries about their prior association with Dough or their current initiative, Lopez’s attorney, Joseph Pardo, highlighted the challenging nature of his client’s investment decisions, heavily influenced by the partners’ assurances.
The Broader Implications of Crypto Ventures
The transition from Dough Finance to World Liberty Financial raises broader questions about the ethical conduct of business ventures involving public officials and their families. Donald Trump’s expanded crypto-related ventures—including a meme coin, a crypto exchange-traded fund, and a newly developed stablecoin—have provoked scrutiny regarding transparency and accountability in financial dealings, especially in the crypto domain, which is often plagued by security vulnerabilities and regulatory ambiguities.
The aftermath of the Dough hack has underscored persistent concerns surrounding decentralized finance (DeFi) platforms, which, by their nature, lack the protective oversight found in traditional financial institutions. With funds stolen from such platforms totaling $2.2 billion in 2024 alone, unauthorized access and theft present ongoing risks for investors. Lopez’s experience exemplifies the difficulty users face in recovering stolen assets from hacked platforms.
As the legal proceedings unfold, the actions of Herro and Folkman, along with the financial practices of the Trump family, will likely remain under the microscope, exacerbating discussions on wealth creation and accountability in the cryptocurrency sector.
This article aims to inform readers about the interconnected nature of crypto ventures, their risks, and the ensuing legal ramifications, highlighting a significant case that intersects finance and political affiliations.
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