The truth about Trump's second son's Bitcoin game: he made a fortune of $100 million, while retail investors suffered a loss of $500 million

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

Original Author: Dan Alexander, Forbes

Translation: Peggy, BlockBeats

This time, Eric Trump brought this approach into the cryptocurrency world. 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 bought with additional stock issuance; the true total cost was far higher than what Eric claimed; and the financing structure that made the balance sheet look better might also mean that all Bitcoin mined so far will be sold in bulk in the future to pay for mining equipment bills.

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

After the report was released, Eric Trump quickly responded on X, accusing Forbes of being bought by China, claiming the report was politically motivated propaganda, and citing operational data to counter: 7,000 Bitcoin, nearly 90k mining machines, and Q4 revenue of $78.3 million. Incidentally, he also brought up an old story from twenty years ago about fundraising for a children’s hospital, trying to prove that Forbes has always targeted “good people” like him.

There is only one thing he has never directly addressed: where did the $500 million go?

Below is the original text:

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

The ability to incite a crowd isn’t just useful in politics. Ask Eric Trump: his Bitcoin company attracted a large following, then dumped a bunch of overpriced stocks on them.

In February this year, Eric Trump appeared energetic at a quarterly earnings call, ready to do what the Trump family does best—sell.

His company, “American Bitcoin,” had just gone public on Nasdaq a year earlier. “We are rapidly becoming a leader in the Bitcoin world, and I truly believe we have the strongest brand,” Eric said, “I want to thank Mike (Mike Ho), Asher (Asher Genoot), Matt (Matt Prusak), and everyone at American Bitcoin.”

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

This closing remark is quite telling. Saying “everyone at” is because American Bitcoin has almost no other staff.

A month after the earnings call, the annual report showed the company had only two full-time employees, probably just CEO Mike Ho and President Matt Prusak. Maybe a few more—Ho also holds an executive role at another company; someone who held a investor relations position there for less than a year now lists himself on LinkedIn as “Chief of Staff” at American Bitcoin; another woman says she has been the social media manager since January this year. (Chairman Asher Genoot, Ho, and three independent directors form a five-member board.)

The Trump family quickly learned an old rule: exaggerating things is profitable.

It is said that Donald’s father, Fred Trump, once deceived regulators and profited by inflating project costs. Donald Trump himself inflated asset values to banks and media like Forbes, ultimately being found guilty of fraud by a New York judge. Eric was also involved in that lawsuit, barred from serving as an executive or director of any New York-registered company for two years. Nevertheless, he started anew, registering in Delaware, basing in Florida, and marketing himself in a way that even his ancestors would admire.

Note: Fred Trump was Donald Trump’s father, a New York real estate developer suspected of inflating construction costs to inflate profits.

Eric Trump’s latest Bitcoin venture may be more about storytelling than a real business. According to him, American Bitcoin can mine Bitcoin at about half the market price, making it a genuine “money-printing machine.” But scrutinizing the numbers raises doubts: can this company actually profit from mining, let alone sustain such astonishing margins? Representatives of Eric Trump, the Trump Organization, and American Bitcoin did not respond to multiple requests for comment. Many believe in the son of the president, and real money has already been invested. On September 3, 2025, American Bitcoin went public, with about $270 million worth of Bitcoin on its balance sheet, and a market valuation of $13.2 billion.

Over the past eight months, American Bitcoin has continued to sell stock and buy more Bitcoin at this absurd valuation. The stock price, after a sharp dilution, has fallen 92% from its peak. Eric Trump initially entered with almost no cost, but now, through financial alchemy, his personal wealth is estimated to have grown from about $190 million to $280 million. Other insiders have also profited significantly. In contrast, ordinary investors who bought into the story with real money have lost an estimated $500 million in total.

Eric Trump (left) was once seen as a charitable figure, launching fundraising events at his father’s golf courses shortly after graduating from college to benefit St. Jude Children’s Research Hospital. Photo: Bobby Bank/WireImage

Eric Trump’s first truly independent project was not an apartment building but a charity.

In 2006, he graduated from Georgetown University with a degree in finance and management, full of enthusiasm for changing the world. At that time, his brother Don Jr. and sister Ivanka had already moved into Trump Tower, involved in real estate projects. One day, while driving on a highway in New Jersey, Eric recalled in an interview with Forbes that a sudden thought crossed his mind: how can I truly do something for the world? This marked the start of his earliest entrepreneurial effort—a nonprofit called “Eric Trump Foundation.”

This organization did many good deeds. It was more of a fundraising platform than an operational charity, donating over $16 million to St. Jude Children’s Research Hospital. But as years passed, the organization and Eric himself began to become more “Trump-like.”

Forbes obtained documents through a public records request (despite objections from the nonprofit’s legal team) showing that the organization engaged in dishonest fundraising rhetoric, had weak governance, and chaotic financials. Eric claimed to donors that he kept expenses minimal, almost all funds went directly to St. Jude, partly because his father provided free use of Trump-owned clubs, and celebrities agreed to perform “pro bono.” But checks and invoices obtained by Forbes showed that over $500k went to other charities, over $500k to Trump-owned businesses, at least $90k paid to performers, and over $35k paid to a chauffeur service—including passengers like Eric’s mother, a “Real Housewives” actress, and a van full of people heading to the Hooters restaurant.

In his father’s daily business, Eric initially focused on hotel operations, learning many lessons—including a key insight: branding a business to make money is far easier than building buildings.

Trump Organization had defaulted on a loan for its Chicago hotel in 2008, filed for bankruptcy protection for Atlantic City assets in 2009, and its Washington, D.C. hotel had been losing money for years. Eventually, the Trump family shifted its hotel empire expansion to what industry calls “light asset” models, focusing on management and branding rather than development.

Another training ground for Eric was his father’s golf course investment portfolio, where he learned the tricks of unconventional financing. In the late 1980s and early 1990s, golf clubs often charged initiation deposits, promising to return them interest-free after thirty years. These liabilities appeared on the books, discouraging many investors from selling the properties. But Donald Trump was fearless, ultimately taking on about $250 million of such liabilities, acquiring income from over a dozen golf properties across the U.S., while long-term liabilities remained zero on his personal balance sheet. When repayment was due, the value of these properties had long surpassed the debt.

In January 2017, Donald Trump took office, and Eric and his brother Don Jr. took over their father’s assets. Eric seemed to have little personal plan, just hoping to follow the script. “We’re not the kind of company that sells assets,” he told Forbes in an interview in February 2017 at Trump Tower, “We buy, and make them look good.” The Trump brothers tried to expand into new businesses, including launching two mid-range hotel brands, but with limited success. Amid tough operations and their father’s cash crunch, they did a lot of what Eric said he wouldn’t do: selling assets, totaling about $411 million in cash.

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

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

Just two weeks after Donald Trump defeated Kamala Harris, the company that later became American Bitcoin was quietly registered in Delaware. It was not initially a cryptocurrency bureau. Hussain Sajwani, a Dubai developer who had partnered with the Trump family on golf projects in Dubai, appeared at Mar-a-Lago, announcing a $20 billion investment in data centers in the U.S., riding the wave of AI hype. “That guy knows what he’s doing,” the then-presidential candidate praised. Within weeks, Trump’s two sons revealed plans to follow this strategy, naming the company “American Data Centers,” with Eric Trump claiming it was “crucial for the development of U.S. AI infrastructure.”

A month later, he changed course. Through mutual friends, Eric and Don Jr. met two entrepreneurs: Asher Genoot and Mike Ho. These two already owned a company similar to what the Trump brothers envisioned—Hut 8, a data center giant with exposure to AI and significant Bitcoin mining capacity. As the AI boom approached, the Bitcoin rewards for solving mathematical puzzles halved, and mining costs soared. Industry-wide, much of the computing power shifted to AI, and Hut 8’s institutional shareholders pressured Genoot to follow the trend.

However, leveraging their backgrounds in brand management and arbitrage trading, Genoot and Ho devised a more creative solution: using a 20% stake in their Bitcoin mining hardware as bait, convincing the Trump brothers to abandon the data center plan. Then, with the family’s involvement, they installed this hardware into a publicly traded company, igniting a Trump-driven hype machine.

This deal structure was tailor-made, as if designed for someone familiar with hotel business. The machines roared day and night, but American Bitcoin’s operation resembled a light-asset hotel brand: Hut 8 owned properties, operated data centers, and handled back-end functions, with executives also dispatched from Hut 8—Prusak previously worked at Hut 8, Ho still does, serving as both American Bitcoin CEO and Hut 8 Chief Strategy Officer. This allowed the Trump brothers to focus solely on their strength: sales.

“I’ll never forget telling them, ‘Look, the name has to have two words,’” Eric Trump recalled in a CoinDesk video interview, “It has to have ‘America,’ it has to have ‘Bitcoin.’” One of them said, “Eric, let’s call it American Bitcoin. That’s the name.”

On the day American Bitcoin went public, investor enthusiasm surged, and Eric Trump’s personal wealth was estimated to have exceeded $1 billion. Photo: Michael M. Santiago/Getty Images

Ever since Eric Trump entered the crypto scene, he’s been telling a myth about why he got involved. “Every bank in this country blacklisted me,” he said at a Wyoming conference last August. “Because my father is a politician, we faced de-banking,” he added 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 into decentralized finance because we realized that’s the future of finance.”

But that’s not quite true.

Indeed, Capital One and JPMorgan Chase closed some of Trump’s accounts in 2021, six years after Donald Trump entered politics. At that time, his reputation was battered by the Capitol Hill riot and extensive investigations by New York Attorney General, with courts ultimately ruling that the Trump Organization committed fraud and was likely to do so again.

Even so, many banks were still willing to work with the Trump family—JPMorgan, after closing some accounts, participated in refinancing two of Trump’s largest loans. When he left the White House, cash was tight and leverage high, and he needed support from major lenders. He got it: from January 2021 to mid-2022, with the help of his sons Eric and Don Jr., he completed nearly $700 million in debt refinancing as part of a comprehensive balance sheet restructuring.

So why did Trump really enter the crypto space? A more plausible explanation is that he sensed an extension of his licensing business—selling NFTs just like sneakers and guitars. He started with NFT trading cards, launching digital images depicting Trump as a superhero. The products sold out in a day, bringing in over $7 million in cash and crypto—crucial for a man facing nearly $500 million in fraud judgments. (Later, an appellate judge overturned that ruling, citing disputes over fines, but did not deny Trump’s fraudulent conduct.) Subsequent crypto projects added billions in liquidity, fueling the Trump family’s bets, including a plan announced last May to spend about $2 billion on cryptocurrencies through Trump Media and Technology Group.

In 2025, Bitcoin accumulation became the hottest trade of the year. Over 200 listed companies rushed to copy Michael Saylor’s strategy—accumulating over $50 billion worth of Bitcoin, which soared in value and market cap during the rally, then plummeted recently. American Bitcoin stood out in this frenzy, thanks to the Trump family halo. But on the day American Bitcoin went public on September 3, 2025, Eric Trump delivered a more data-driven narrative in a Spaces chat on X. “Our actual cost to mine a Bitcoin each day is about $57k to $58k,” he said, noting that the market price of Bitcoin was roughly twice that, “Our fundamentals are better than ever.”

This argument sounds convincing, even though the speaker had already been accustomed to selectively ignoring unfavorable expenses during charity fundraisers. Over $50,000 covers American Bitcoin’s equipment operating costs. But if you include other expenses—buying equipment, marketing, capital allocation—the total costs rise significantly, roughly to $92k per Bitcoin at that time, only profitable if Bitcoin prices stay high.

Depreciation is especially critical in American Bitcoin’s case because it adopted Hut 8’s unconventional financing strategy. Between August and September 2025, American Bitcoin spent about $330 million upgrading its mining fleet. But instead of paying cash upfront, it pledged some Bitcoin and obtained an option on the final payment: if Bitcoin prices rose, the company could pay about $330 million in cash and redeem the pledged Bitcoin; if prices fell, it could settle with the pledged crypto.

Since that large purchase, Bitcoin has fallen about 30%. This means that, currently, American Bitcoin is likely to pay for equipment with the pledged crypto assets. But the problem is: as of March 25, the company pledged 3,090 Bitcoin, while it has only mined about 1,800. In other words, if prices do not rebound, all the Bitcoin mined so far will be used to settle equipment costs when the options expire around August 2027, leaving no profit.

Investors may not understand this. The company still has about 15 months to decide whether to pay in crypto or cash, and during this period, the mined Bitcoin remains on the balance sheet. The result is that American Bitcoin appears far more stable than it actually is. The company promotes this Bitcoin reserve as a core selling point but deliberately downplays a fact: most or all of it will eventually be used to pay for the machines that mined it.

Beyond marketing appeal, it’s easy to see why the Trump family is interested in this payment method—they once built a portfolio of golf courses using similar unconventional financing. They won that gamble because the assets’ value actually increased.

Eric Trump has become a regular at major crypto conferences worldwide, pictured here attending an event in Hong Kong. Photo: Daniel Ceng/Anadolu via Getty Images

About 70% of the cryptocurrencies held by American Bitcoin are not mined but acquired through stock sales or direct purchases on the open market. This is the real secret behind American Bitcoin.

Why would Hut 8 be willing to give up 20% of its Bitcoin mining hardware shares to a newly formed data center company? Perhaps because, in an era of meme stocks and MAGA fervor, a Trump name alone can attract enough “fool money” to push the stock price sky-high. When the stock becomes absurdly overvalued, the company can sell its shares and reinvest the proceeds into Bitcoin, stacking up mountains of crypto.

This is a hype-driven arbitrage game: convincing investors that the company is worth a fortune, then selling shares when the stock price is outrageously high. As long as the profits from this arbitrage exceed the value of that 20% mining hardware stake, it’s a profitable deal for insiders—while retail investors outside the circle are another story.

The sell-off started almost immediately after the IPO. Within 27 days of listing, American Bitcoin sold 11 million shares, raising $90 million at an average of about $8 per share. After deducting broker commissions ($2 million), American Bitcoin bought about 725 Bitcoin. As the stock price declined, the selling continued. From early October to mid-November, the company sold another 7 million shares, raising $44 million at an average of just over $6 per share. In late November, after Bitcoin’s price plunged, the company sold a further 47 million shares before year-end, raising about $106 million at an average of $2.25 per share.

The sell-off was not just about the company itself. In early December, early investors’ lock-up periods expired, and within two trading days, the stock plummeted 48%. Prominent supporters stepped in to boost confidence. Crypto evangelists Cameron and Tyler Winklevoss—who had actively engaged with the Trump family through donations to pro-Trump super PACs and White House event support—publicly endorsed the company.

Note: Cameron and Tyler Winklevoss are twin brothers, well-known crypto investors, closely linked to the Trump family, and previously publicly endorsed American Bitcoin.

Former White House Communications Director Anthony Scaramucci also joined the endorsement. Host Grant Cardone claimed to be a “long-term investor, not a short-term trader,” later adding that his tweet “does not constitute investment advice.” American Bitcoin’s official social media accounts shared all these endorsements. Neither Cardone nor the Winklevoss brothers responded to requests for comment, and Scaramucci’s representatives declined to comment.

Note: Anthony Scaramucci briefly served as White House Communications Director under Trump for 11 days, then transitioned into a crypto investor supporting American Bitcoin. Grant Cardone is a well-known sales trainer and motivational speaker in the U.S., publicly supporting American Bitcoin on social media but stating that his posts “do not constitute investment advice.”

Bitcoin prices continued to be under pressure, especially after the Federal Reserve paused rate cuts in January. The company stuck to its original strategy. Forbes estimates that from January 1 to March 25, American Bitcoin sold 84 million shares, raising $111 million, and used that to buy about 1,430 Bitcoin. Overall, from its founding to the end of March this year, American Bitcoin’s total investment in crypto was about $525 million, while the current market value of those coins is roughly $390 million, resulting in a cumulative loss of about $135 million for shareholders.

Last year, Eric Trump spoke at a crypto conference in Dubai, praising the UAE. “Other countries in the world must be alert to the UAE, for one reason only,” he told the audience, “they will always give you a ‘yes’.” Photo: Giuseppe Cacace/AFP via Getty Images

American Bitcoin’s mining operations are ongoing. But as Bitcoin’s price has fallen 31% since the company’s IPO, the economic calculations are becoming more difficult. Upgrading the new mining fleet has lowered operating costs to about $47k per Bitcoin. But including management, amortization, and depreciation, the total costs still reach roughly $90k per Bitcoin, about $13k above the current market price, making profitability only possible if prices stay high.

If investors no longer believe in the “money-printing” story, what will happen to Eric Trump’s company? He can pray for a sharp rebound in Bitcoin prices—since it’s a highly volatile asset. Forbes estimates that if prices rise by 35%, American Bitcoin can pay for equipment in cash, keep the pledged crypto, and turn the $135 million trading loss into a small profit. At that point, Eric can claim everything was part of the plan.

Of course, if he doesn’t want to gamble on luck, there’s another option: seek a few eager overseas investors. Sheikh Tahnoon bin Zayed Al Nahyan has already connected with another Trump crypto project, injecting an estimated $375 million. While this investment has performed modestly in financial returns so far, the UAE has gained Trump’s support for advancing its AI initiatives. Reports suggest this Gulf nation is seeking some form of relief from U.S. economic pressure amid tensions over Iran.

The CEO of American Bitcoin, Mike Ho, was last recorded as residing in the UAE in November 2023, though the company’s representatives did not respond to inquiries about his current whereabouts. Nonetheless, Ho appeared in the Gulf country last October for an interview with Arabian Gulf Business Insight, mentioning contacts with ADQ and TAQA—both linked to Sheikh Tahnoon. An American Bitcoin spokesperson told Forbes in October that Ho was referring to early communications before the company’s founding. Recent recordings, however, show that American Bitcoin remains open to overseas collaborations.

“I’ve met with many sovereign wealth funds here, through Hut 8 and under the American Bitcoin name,” Ho said in the recording. “The conversations are ongoing.” When asked whether they are considering Bitcoin mining in the region, Ho responded, “We’re always exploring this space. I’ve spoken with ADQ and TAQA. We’ve studied their asset portfolios. The UAE has abundant excess electricity, and Bitcoin mining is a good way to monetize that surplus.”