Original Title: How Eric Trump Got Rich From Bitcoin While Losing Investors A Fortune

Original Author: Dan Alexander, Forbes

Translation: Peggy, BlockBeats

Editor's Note: The Trump family has a family heirloom skill: to exaggerate and make something sound bigger than it actually is.

This time, Eric Trump brought this method into the cryptocurrency arena. He packaged his Bitcoin company as a "money printing machine", claiming the company could mine Bitcoin at nearly half the market price.

But when Forbes reporter Dan Alexander opened the books, the story revealed another side: 70% of the Bitcoin held by this company was not mined but purchased by issuing additional shares; the actual comprehensive costs were far higher than the numbers Eric mentioned; that financing structure designed to make the balance sheet look prettier could also mean that all Bitcoin mined to date would have to be used to pay off mining machine bills in bulk in the future.

The numbers ultimately point to a more direct conclusion: Eric's personal wealth increased by about $90 million, while ordinary investors lost a total of about $500 million.

After the report was released, Eric Trump quickly struck back on X, accusing Forbes of being acquired by China and claiming the report was politically driven propaganda, while pulling out a string of operational data to refute: 7,000 Bitcoins, nearly 90,000 mining machines, and fourth-quarter revenue of $78.3 million. In addition, he also brought up an old story from twenty years ago about fundraising for a children’s hospital, trying to prove that Forbes had always targeted a "good person" like him.

There was only one thing he consistently failed to address directly: where that $500 million went.

The following is the original text:

Eric Trump rallies the crowd. Photo: Daniel Ceng/Anadolu via Getty Images

The ability to rally the crowd is not only useful in politics. Just ask Eric Trump: his Bitcoin company attracted a large following, and then dumped a bunch of overpriced stocks on them.

In February of this year, Eric Trump energetically appeared on a financial report conference call, ready to do what the Trump family does best—sell.

His company "American Bitcoin" had just gone public for a year and was already listed on NASDAQ. "We are rapidly becoming leaders in the Bitcoin world, and I genuinely believe we have the strongest brand," Eric said, "I want to thank Mike (Mike Ho), Asher (Asher Genoot), Matt (Matt Prusak), and every colleague at American Bitcoin."

Note: Mike Ho, CEO of American Bitcoin, also serves as Chief Strategy Officer of Hut 8. Asher Genoot, Executive Chairman of American Bitcoin, co-founder of Hut 8, led the collaborative deal with the Trump family. Matt Prusak, President of American Bitcoin, former Hut 8 employee, assigned by Hut 8.

This closing was quite thought-provoking. Saying "every colleague" is because there are almost no other people at American Bitcoin.

The annual report submitted a month after the conference call revealed that the company officially had only two full-time employees, presumably the CEO Mike Ho and President Matt Prusak. Perhaps there are a few more—Ho concurrently holds an executive position at another company; someone who held the investor relations position at that company for less than a year now claims the title of "Chief of Staff" at American Bitcoin on LinkedIn; another woman stated she has served as the social media manager since January of this year. (Executive Chairman Asher Genoot together with Ho and three independent directors forms a five-member board.)

The Trump family figured out a rule early on: making things sound bigger than they are can be profitable.

Reportedly, Donald's father Fred Trump deceived regulators and profited by inflating project costs. Donald Trump inflated asset values to banks and media outlets like Forbes, ultimately being ruled by a New York judge as committing fraud. Eric was also swept into that lawsuit and was banned from serving as an executive or director of any company registered in New York for two years. Nevertheless, he started anew by registering in Delaware and establishing his own company, marketing it in a way that would impress even his ancestors.

Note: Fred Trump, Donald Trump's father, a New York real estate developer, was alleged to have inflated construction costs for higher profits.

Eric Trump’s latest Bitcoin venture may be selling more of a story than a legitimate business. According to him, American Bitcoin can mine Bitcoin at about half the market price, a genuine "money printing machine." But delving into the numbers raises questions: can this company really achieve profitable mining, let alone maintain such astonishing profit margins? Representatives from Eric Trump, the Trump Organization, and American Bitcoin did not respond to multiple requests for comment from Forbes. There are many who trust the president's son, having already placed real money bets. On September 3, 2025, American Bitcoin went public, with approximately $270 million in Bitcoin on its balance sheet, while investors assigned it a market value of up to $13.2 billion.

Over the past eight months, American Bitcoin has continually exploited this outrageous valuation to sell stock and purchase more Bitcoin. The significantly diluted stock price has now dropped 92% from its peak. Eric Trump seemed to have initially entered the game with almost no cost, yet still thrived, and through a series of financial alchemy, his personal wealth estimate has ballooned from about $190 million to $280 million. Other insiders also profited significantly. In contrast, ordinary investors who believed the sales story and invested real money have collectively lost an estimated $500 million.

Eric Trump (left) presented a charitable image in his early years, shortly after graduating from college, he initiated fundraising activities at his father's golf course to raise money for St. Jude Children's Research Hospital. Photo: Bobby Bank/WireImage

The first truly independent project of Eric Trump's life was not an apartment building, but a charitable organization.

In 2006, he graduated from Georgetown University with a degree in finance and management, filled with enthusiasm to change the world. At that time, his brother Donald Jr. and sister Ivanka had already moved into Trump Tower and were engaged in real estate projects. One day while driving on the New Jersey Turnpike, Eric later recalled in an interview with Forbes, another thought popped into his head: how could he really make a difference in the world? Thus began his earliest entrepreneurial practice—a non-profit organization named the "Eric Trump Foundation."

This organization did a lot of good. Rather than being an operational charity, it was more like a fundraising platform, delivering over $16 million to St. Jude Children's Research Hospital. However, as time passed, this organization, and even Eric himself, began to become increasingly "Trump-like."

Documents obtained by Forbes through information requests (despite objections from the non-profit's legal team) indicate that the organization exhibited dishonest fundraising tactics, weak governance structures, and chaotic financial conditions. Eric claimed to donors that he kept expenses to a minimum, directing nearly all funds directly to St. Jude, partly because his father provided the Trump-owned club venues for free, and well-known individuals agreed to perform "for free." But checks and invoices obtained by Forbes show that over $500,000 flowed to other charities, over $500,000 went to Trump-owned properties, at least $90,000 paid to various performers, and over $35,000 paid to a car service company—passengers included Eric's mother, an actress from "The Real Housewives" series, and a van full of people headed to Hooters restaurant.

In his early years at his father's company's daily operations, Eric was mainly responsible for the hotel business, learning a lot, including a key insight: branding a business is much easier than actually building one.

Trump Organization defaulted on loans for its Chicago hotel in 2008 and filed for bankruptcy for its Atlantic City asset portfolio in 2009, with their D.C. hotel losing money for several years. Ultimately, the Trump family shifted the expansion path of their hotel empire to what is known in the industry as a "light asset" model, shifting the focus from development to management and brand licensing.

Another training ground for Eric was his father's golf course investment portfolio, where he saw the merits of unconventional financing structures. In the 1980s and 1990s, golf clubs usually collected deposits from members upon joining, promising a zero-interest refund after thirty years. These liabilities made many investors hesitant when it came to selling properties. But Donald Trump was undeterred and ultimately took on about $250 million in such liabilities, thereby acquiring more than a dozen golf properties scattered across the United States, all the while keeping these liabilities listed as zero on his personal balance sheet for many years. By the time repayment was nearing, the value of these properties had far exceeded the amount owed.

In January 2017, Donald Trump took office in the White House, and Eric and his brother Donald Jr. took over their father's asset portfolio. Eric seemingly had little personal plan, just hoping to go with the flow. "We're not a company that sells assets," he told Forbes in an interview in February 2017 from his office on the 25th floor of Trump Tower, "We buy them and manage them well." The Trump brothers attempted to expand new businesses, including launching two mid-range hotel brands, but with little success. In the context of struggling operations and their father's cash reserves dwindling, they did a lot of things that Eric said they wouldn’t do in the following seven years: sell assets, estimated cashing in about $411 million.

Then, a new money-making opportunity arose: the 2024 election.

Returning to the White House means new business opportunities. President Trump's children attended their father's second inauguration on January 20, 2025. Photo: Kenny Holston-Pool/Getty Images

Just two weeks after Donald Trump beat Kamala Harris, the company that would later evolve into American Bitcoin was quietly registered in Delaware. It had not started as a cryptocurrency entity. Dubai developer Hussain Sajwani, who collaborated with the Trump family on a golf project in Dubai, appeared at Mar-a-Lago, announcing a $20 billion investment to build data centers in the U.S., riding the wave of artificial intelligence hype. "That man knows what he’s doing," the then president praised. Within weeks, Trump's two sons revealed plans to follow this strategy and named the company "American Data Centers," which Eric Trump called "crucial to the development of AI infrastructure in the U.S."

A month later, he changed direction. Through mutual friends, Eric and Donald Jr. met two entrepreneurs: Asher Genoot and Mike Ho. These two already had a business similar to what the Trump brothers envisioned—a data center giant, Hut 8, which not only had exposure to AI business but also controlled significant Bitcoin mining power. Shortly after the wave of artificial intelligence arrived, the Bitcoin rewards for solving mathematical problems were halved, significantly raising mining costs. On an industry level, a massive amount of computing power shifted to AI, prompting Hut 8's institutional shareholders to press Genoot to follow suit.

However, Genoot and Ho, with their backgrounds in brand management and arbitrage trading, came up with a more creative solution: using a 20% stake in their Bitcoin mining equipment as bait to persuade the Trump brothers to abandon the data center plan. Then, leveraging the involvement of the first family, they loaded this equipment into a public company, igniting a promotional machine driven by the Trump aura.

This deal structure was tailor-made as if designed specifically for someone familiar with the hotel business. The machine roared day and night, but the operation of American Bitcoin felt more like a light asset hotel brand: Hut 8 owned properties, operated data centers, handled backend operations, and even sent executives from Hut 8—Prusak had previously worked at Hut 8, while Ho still held a position there, simultaneously serving as CEO of American Bitcoin and Chief Strategy Officer of Hut 8. This way, the Trump brothers only needed to focus on their strengths: sales.

"I always remember telling them, 'Listen, the name has to have two words,'" Eric Trump later recalled in a video interview with CoinDesk, "It must have 'American' and must have 'Bitcoin.' One of them said, 'Eric, let’s name it American Bitcoin; that’s the name.'"

On the day of American Bitcoin's listing, investor enthusiasm was sky-high, pushing Eric Trump's personal wealth estimate over $1 billion at one point. Photo: Michael M. Santiago/Getty Images

Since Eric Trump entered the cryptocurrency circle, he has been constantly weaving a myth about why he got into the business. "Every bank in this country blacklisted me," he said last August at a conference in Wyoming. "Because my father is a political figure, we faced de-banking," he added about a week later in Hong Kong. "Every major bank started closing our accounts," he claimed earlier this year in Palm Beach, "You know what we did? We went out and entered decentralized finance because we realized that was the future of finance."

But that is not the case.

Indeed, Capital One and JPMorgan Chase closed some of Trump's accounts in 2021, six years after Donald Trump entered politics. At that time, the president's reputation was severely damaged due to the Capitol incident and a massive investigation by the New York Attorney General, with the court ultimately ruling that the Trump organization committed fraud and was likely to do so again.

Even so, many banks remained willing to work with the Trump family—even JPMorgan, shortly after closing some accounts, participated in the refinancing of two of the largest loans in Trump’s asset portfolio. When Trump left office, he was in urgent need of support from large lending institutions, with cash reserves running low and leverage high, and he did indeed receive it: from January 2021 to mid-2022, with the assistance of his sons Eric and Donald Jr., he completed nearly $700 million in debt refinancing as part of a full balance sheet restructuring.

So why did Trump really enter the cryptocurrency field? A more plausible explanation is that he sniffed out opportunities to extend brand licensing, just like selling sneakers and guitars by hawking non-fungible tokens (NFTs). He started with NFT trading cards, launching digital images that depicted Trump as a superhero. The products sold out within a day, ultimately bringing in over $7 million in cash and cryptocurrency for the former president—every penny being crucial for someone facing a nearly $500 million fraud judgment. (Later, an appellate judge overturned the judgment on the grounds of disagreement on the penalty amount but did not dismiss the finding of Trump's fraudulent behavior.) Subsequent cryptocurrency projects brought in hundreds of millions in additional liquidity, pushing the first family’s betting scale further, including an announcement last May of a separate initiative: purchasing cryptocurrency worth approximately $2 billion through Trump Media and Technology Group.

In 2025, hoarding Bitcoin became the hottest trade of the year. Over 200 publicly traded companies rushed to replicate the strategy of Michael Saylor’s company, which accumulated over $50 billion in Bitcoin positions, seeing its market value soar as prices surged, and recently rebounding sharply. American Bitcoin stood out in this craze for obvious reasons: the aura of the first family. But on the very day American Bitcoin went public on September 3, 2025, Eric Trump delivered a more data-driven statement during a Spaces conversation on the platform X. "The actual cost of Bitcoin we mine each day is about $57,000 to $58,000 per coin," he said, noting that at the time, the market price of one Bitcoin was approximately twice that, "Our fundamentals couldn’t be better."

This argument was quite persuasive, despite the speaker being accustomed to selectively ignoring adverse expenses during charity fundraising events. Over $50,000 indeed covered the operational costs of American Bitcoin’s equipment. However, if other expenses were included—such as equipment procurement, marketing, and capital allocation—the comprehensive cost would rise to a much higher number, estimated at around $92,000 per Bitcoin at the time, making profitability possible only if cryptocurrency prices remained high.

Including depreciation in calculations is particularly crucial in the case of American Bitcoin, as it follows an unconventional financing strategy from Hut 8. Between August and September 2025, American Bitcoin splurged about $330 million upgrading its mining fleet. However, the company did not immediately pay cash; instead, it pledged a batch of Bitcoin and acquired an option on the final payment method: if Bitcoin prices rose, the company could pay about $330 million in cash and redeem the pledged Bitcoin; if prices fell, the company could directly use the pledged cryptocurrency to settle.

Since this major procurement, Bitcoin has dropped about 30%. This means that, as it stands, American Bitcoin is likely to use the staked crypto assets to pay for the equipment costs. But the problem is: the total amount of Bitcoin pledged by American Bitcoin is 3,090 coins (as of March 25), while the company has estimated that it has only mined about 1,800 coins to date. In other words, if prices do not rebound, all Bitcoins mined to date will be fully used to bank equipment costs as their option expires around August 2027, leaving nothing in return.

Investors may not understand this. The company still has about 15 months to decide whether to pay for the equipment with cryptocurrency or cash, during which the mined Bitcoins remain on the balance sheet. The result is that American Bitcoin appears far more robust than it actually is. The company markets this batch of Bitcoin reserves as a core selling point to investors but deliberately downplays one fact: all or most of them will ultimately be used to pay for the machines that mined them.

Besides the attractiveness at the marketing level, it’s not hard to understand why the Trump family is interested in this payment method—they built a portfolio of golf courses on similar unconventional financing years ago. That time they won, because the value of the assets indeed went up.

Eric Trump has become a regular at major cryptocurrency conferences, as seen at an event in Hong Kong. Photo: Daniel Ceng/Anadolu via Getty Images

About 70% of the cryptocurrency held by American Bitcoin is not actually earned through mining but obtained through selling stocks and directly purchasing Bitcoin on the open market. This is the core secret of American Bitcoin.

Why was Hut 8 willing to hand over 20% ownership of its Bitcoin mining equipment to a newly established data center company? Perhaps the reason lies here: in an era of meme stocks and MAGA enthusiasm, a name like Trump is enough to attract enough "dumb money" to drive the stock price up. Once the share price becomes illogically high, the company can sell its own shares, reinvesting the funds into Bitcoin, piling up cryptocurrencies.

This is an arbitrage game driven by speculation: convincing investors that the company is worth a fortune and then selling shares when they know the stock price is absurdly inflated. As long as the earnings generated from this arbitrage game exceed the value of that 20% mining equipment stake, it is a profitable deal for insiders who set it up—as for outside investors buying the shares, that is another story.

The sell-off nearly began immediately after the listing. Within 27 days of American Bitcoin's listing, at the peak of enthusiasm, the company sold a total of 11 million shares, cashing out $90 million, at an average price of around $8 per share. After deducting middlemen's commissions (which totaled $2 million), American Bitcoin purchased about 725 Bitcoins. Subsequently, as the stock price gradually declined, the sell-off continued. From early October to mid-November, the company sold another 7 million shares, cashing out $44 million, at an average of slightly over $6 per share. Entering late November, following a crash in Bitcoin prices, the company made a strong push, dumping 47 million shares before year-end, bringing in about $106 million, at an average price of around $2.25 per share.

It wasn’t just the company itself that was sold off. In early December, the lockup period for early investors was lifted, leading to a 48% plunge in the stock price within two trading days. Well-known supporters came forward to lift spirits. Cryptocurrency evangelists Cameron and Tyler Winklevoss publicly expressed their support, having proactively reached out to the first family through donations to Trump-linked super PACs and backing White House events.

Note: Cameron and Tyler Winklevoss are twin brothers, well-known cryptocurrency investors in the U.S., closely related to the Trump family, who publicly endorsed American Bitcoin.

Former White House Communications Director Anthony Scaramucci also joined the backing group. Event host Grant Cardone claimed to be "a long-term investor, not a short-term trader," then added that his tweet "does not constitute investment advice." American Bitcoin's official social media accounts forwarded all these messages to their fans. Cardone and the Winklevoss brothers did not respond to requests for comment, and Scaramucci's representative declined to answer.

Note: Anthony Scaramucci briefly served as White House Communications Director under Trump for only 11 days, later transforming into a cryptocurrency investor for American Bitcoin. Grant Cardone is a well-known sales trainer and motivational speaker in the U.S., who publicly expressed his support for American Bitcoin but simultaneously stated that the content "does not constitute investment advice."

Bitcoin prices continued to be under pressure, especially after the Federal Reserve paused rate cuts in January. The company held firm to its original strategy. According to estimates from Forbes, from January 1 to March 25, American Bitcoin sold a total of 84 million shares, cashing out $111 million, and used this to buy about 1,430 Bitcoins. When summed up, from its inception to the end of March this year, American Bitcoin’s total investment in cryptocurrencies was around $525 million, while this batch of coins was currently valued around $390 million, resulting in an accumulated loss of approximately $135 million of shareholder funds.

Last year, Eric Trump praised the UAE at a cryptocurrency conference in Dubai. "The rest of the world must be cautious of the UAE for one reason," he told the audience, "They will always give you a 'yes'." Photo: Giuseppe Cacace/AFP via Getty Images

The mining operations of American Bitcoin continue. However, as Bitcoin prices have dropped 31% since the company went public, the economic calculations are becoming increasingly difficult. Optimizing the new mine fleet has reduced operational costs to about $47,000 per Bitcoin. However, comprehensive costs—including management fees, amortization, and depreciation—are still estimated to be around $90,000 per Bitcoin, exceeding the current market price by about $13,000. The stock price has already fallen another 29% this year.

If investors no longer believe the "money printing machine" story, where will Eric Trump's company go? The president's son can only pray for a significant rebound in Bitcoin prices—after all, this is a highly volatile asset. According to estimates, if there is a 35% increase, American Bitcoin would be able to pay for the equipment in cash, preserve the staked cryptocurrencies, and turn that $135 million trading loss into a slight profit. At that point, Eric could completely claim that everything was planned.

Of course, if he does not want to bet the company's success on luck, there might be another option: finding a few overseas backers eager to help. Sheikh Tahnoon bin Zayed Al Nahyan from the UAE has already established links with another Trump cryptocurrency project, providing an estimated $375 million to the president and his sons. This investment has thus far yielded modest financial returns, but the UAE has indeed gained support from President Trump in advancing its AI agenda. Reports indicate that this Gulf nation is currently seeking some form of relief from the economic pressures resulting from the war in Iran.

American Bitcoin's CEO Mike Ho's most recently recorded residence was in the UAE in November 2023, although company representatives did not respond to inquiries about his current whereabouts. In any case, Ho appeared in this Gulf country last October, where he was interviewed by a reporter from Arabian Gulf Business Insight, mentioning contacts with ADQ Investment Group and TAQA Energy, both associated with Sheikh Tahnoon. A spokesperson for American Bitcoin informed Forbes in October that Ho was referring to early communications before the formation of American Bitcoin. However, recordings obtained recently show that American Bitcoin is open to overseas cooperation.

"Through Hut 8 and in the name of American Bitcoin, I have met with many sovereign wealth funds here," Ho said in the recording, "Conversations are always ongoing." When asked whether he was considering conducting Bitcoin mining in the region, Ho responded, "We are always keeping an eye on this area. I have engaged in conversations with ADQ and TAQA. We have studied their portfolios. The UAE has a lot of surplus electricity, and Bitcoin mining is a great way to monetize that surplus power."

These words come from someone well aware of the lucrative arbitrage opportunities at hand.

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