UPDATE: Trump Jr.-backed startup receives $620 million Pentagon loan
In October, Popular Information reported that the Pentagon awarded a contract to Unusual Machines, an obscure drone company that President Trump’s son, Donald Trump Jr., joined as an advisor in November 2024, despite having no notable experience with drones or military contracting.
The contract was for the manufacturing of 3,500 drone motors, and the Army also “indicated it planned to order an additional 20,000 components” from Unusual Machines next year. Trump Jr. was given 200,000 shares of the company’s stock in 2024, which are now worth millions.
Now, another small startup funded by 1789 Capital, a venture capital firm where Trump Jr. is a partner, will receive a $620 million loan from the Defense Department, the Financial Times reported. Vulcan Elements, which currently has around 30 employees, produces rare-earth magnets, which can be used in “drones, radar systems and other military applications.” The contract was awarded just three months after 1789 invested in Vulcan.
The loan is part of a larger $1.4 billion deal announced last month that also involves another company, ReElement Technologies. It also includes $50 million from the Commerce Department and $550 million from private investors. In exchange, the “Department of Commerce will receive $50 million of equity in Vulcan Elements.” The Department of Defense will receive warrants for Vulcan Elements — an option to buy a stake in the future — according to a press release.
Both Vulcan CEO John Maslin and Unusual Machines CEO Allan Evans said that Trump Jr. played no role in securing the government contracts. According to the Financial Times, “[a]t least four of 1789’s portfolio companies have won contracts from the Trump administration this year, amounting to more than $735 million.”
Trump Jr. “helped screen candidates for top jobs at the Pentagon on behalf of his father after the election.” In September, Trump Jr. said on his podcast that he looked for candidates who wanted to spend more on drones, alleging that the military is “better served with a drone that costs… a tiny fraction of that of a plane.” During the nomination process, Trump Jr. was also an outspoken defender of Defense Secretary Pete Hegseth, who later issued several directives that enabled the Pentagon to increase spending on drones.
Trump family crypto scheme runs into trouble
As Trump has boosted the crypto industry from the White House by softening regulations and creating a national crypto reserve, he and his sons have raked in cash from their own crypto firm, World Liberty Financial.
In August, World Liberty Financial sold $750 million of $WLFI, the firm’s cryptocurrency, to a small tech company called Alt5 Sigma. Alt5 Sigma bought the stockpile of $WLFI to tie the value of its stock to the value of the cryptocurrency. This move mimicked a firm called Strategy, which created a Bitcoin reserve that initially sent its stock price soaring. The tactic has since fallen out of favor and Strategy’s stock has lost about 50% of its value in the last six months.
When Alt5 Sigma created its $WLFI stockpile, the Trump family netted about $500 million in cash and received an equity stake in the company. According to the World Liberty Financial website, DT Marks DEFI LLC receives 75% of the proceeds from $WLFI. At the start of 2025, 70% of this LLC was owned by President Trump and the rest was divided among family members. The family sold an unknown amount of the company earlier this year.
At the time of the deal, Trump Jr., was made a non-voting observer of Alt5 Sigma’s board. His brother, Eric, is currently listed as a “Strategic Advisor and Observer.” Zach Witkoff, World Liberty Financial CEO and son of Trump’s Middle East envoy Steve Witkoff, is the board’s chair.
Three months after the deal with World Liberty Financial, the company finds itself in chaos.
On November 19, Nasdaq notified the company that it is out of compliance with listing requirements after the company failed to file a quarterly report with the Securities and Exchange Commission (SEC). Failure to resolve the issue could result in the stock being delisted from the exchange.
The company removed its acting CEO last month after firing his predecessor in October. In May, a subsidiary of the company was found liable for money laundering in Rwanda.
Alt5 Sigma blamed the delayed report on its accountant, who the company claims resigned on November 21. However, the accountant has said he notified the company before June 30 that he would resign after the filing of an August quarterly report. Public companies are required to notify the SEC of their accountant’s departure within four days.
Adding to Alt5 Sigma’s troubles, cryptocurrency prices have tumbled in recent weeks, causing the stock prices of firms with crypto reserves to fall as well. Alt5 Sigma shares have gone down in value by 75% since it created its $WLFI reserve. Although the Trumps’ stake in Alt5 Sigma has lost value, they have still made hundreds of millions of dollars from the company’s $WLFI purchase.
It is corruption dressed up as venture capital.
Another grift pipeline, siphoning money through family name and political access, proving once again that MAGA “entrepreneurship” is just kleptocracy in startup drag.
They keep pillaging and plundering the country for their own sick games.
Who is going to finally stop them?
—Johan
This is a stunning report, Rebecca and Noel! What no one seems to want to talk about is the possible future consequences of all this “illegal” profiteering and influence-peddling on Trump family liabilities. Are these deals actionable? Worthy of prison, or just a few hundred million fine and a slap on the wrist? The stench makes gilded age barons smell like Arpẽge by comparison.