What does the reverse merger between Tron and SRM reveal about Justin Sun’s strategy, and how does Trump’s indirect involvement influence its market perception?
Tron goes public through the backdoor
On Jun. 16, Tron (TRX), the blockchain network founded by Justin Sun, completed a reverse merger with SRM Entertainment, a small Nasdaq-listed firm known for licensing theme park merchandise.
Valued at up to $210 million, the deal quickly drew attention due to its political connections and unconventional structure. Rather than pursuing a traditional IPO, Tron became public by acquiring SRM through a reverse listing. The new entity has been rebranded as Tron Inc.
As part of the transaction, SRM received a $100 million equity investment from an unnamed private investor to acquire TRX tokens. Additional warrants linked to the agreement could raise the final value, positioning the deal as one of the largest token-related mergers so far in 2025.
Investor response was swift. SRM’s stock jumped from $1.45 on Jun. 13 to $9.19 on Jun. 16, rising over 530%. Although it declined to $7.73 on Jun. 17, the stock remains up approximately 850% over a five-day span.
TRX saw a more modest response. The token moved from a low of $0.2701 on Jun. 16 to a high of $0.2899 before settling near $0.2711 at the time of writing.
A key player behind the deal was Dominari Securities, a New York-based investment bank operating out of Trump Tower.
The firm facilitated the transaction and is owned by Dominari Holdings, whose advisory board includes Eric Trump and Donald Trump Jr., both of whom were appointed in February 2025.
Speculation increased when a Financial Times report on Jun. 16 suggested that Eric Trump could soon take a formal position at Tron Inc.
Later that day, he denied involvement in a post on X, writing, “While Justin is a great friend and an icon in the crypto space, I have no public involvement in the merger plans.”
Sun has been appointed as an advisor to Tron Inc., which will hold TRX tokens on its corporate balance sheet. The approach mirrors Strategy’s Bitcoin-focused strategy, further aligning Tron Inc. with asset-backed treasury models.
The structure of the deal has drawn comparisons to reverse mergers used by Chinese companies in the late 2000s to enter U.S. markets. That period prompted regulatory reforms, including the SEC’s 2011 rules aimed at curbing shell-company activity and tightening scrutiny on foreign listings.
The timing has also raised questions. In February 2025, the SEC paused a longstanding fraud investigation into Sun, citing a reallocation of enforcement priorities. Four months later, the merger was publicly announced. However, there is no direct evidence of misconduct so far.
Sun’s Trump-linked crypto play
The connection between Sun and Donald Trump did not form suddenly. It began developing during the second half of 2024 through a series of strategic financial decisions that aligned Sun with the Trump family’s growing involvement in crypto.
In September 2024, World Liberty Financial (WLFI), a decentralized finance project linked to the Trump network, faced difficulty reaching its early fundraising targets. Sun stepped in with a $30 million investment.
Within four months, he followed up with another $45 million, bringing his total stake in WLFI to $75 million and establishing himself as one of its most influential backers.
The alignment extended beyond DeFi. In January 2025, just before Trump returned to office, a new memecoin named Official Trump (TRUMP) was launched. Sun purchased $20 million worth of the token, making him the largest holder among 220 wallets.
Blockchain data later confirmed that his wallet controlled 18.6 million TRUMP tokens, with a market value of roughly $57 million as of June 2025. Combined with his WLFI investment, Sun’s total exposure to Trump-affiliated crypto initiatives exceeded $97 million.
The financial backing translated into political access. On May 22, Sun attended a private dinner at Trump National Golf Club in Virginia alongside 24 other top TRUMP token holders.
At the event, he received a Trump-branded watch reportedly worth $100,000. The dinner was part of a broader campaign to increase visibility and distribution of the TRUMP token.
Altogether, the token sale raised approximately $148 million, with a notable share originating from anonymous and international wallets. The funding trail has drawn scrutiny for its lack of transparency, especially in the context of political crypto fundraising.
Trump’s own position on digital assets has shifted over time. After describing Bitcoin as a “scam” in 2021, he has adopted a more supportive tone during his second term, a change that has helped reinforce the growing alliance between his network and crypto investors like Sun.
Tron integrates USD1 on global stage
On May 1, during the Token2049 event in Dubai, Justin Sun announced that his blockchain network, Tron, would integrate the stablecoin USD1 through a new partnership with World Liberty Financial (WLFI).
Standing alongside Eric Trump and WLFI co-founder Zach Witkoff, Sun said, “I’m really honored we can collaborate with USD1 on launching this stablecoin to further make this available to 7 billion people on Earth.”
USD1 is pegged to the U.S. dollar and backed by a mix of short-term government treasuries, dollar deposits, and other cash-equivalent reserves.
Witkoff stated that USD1 will be natively integrated into the Tron blockchain, with initial minting expected in the hundreds of millions of dollars and ambitions to scale into a multi-billion-dollar market cap.
HTX, the crypto exchange closely tied to Sun, became the first platform to list USD1, extending its availability to a broader market.
The same day, WLFI was also revealed to be involved in a $2 billion investment deal between Abu Dhabi’s MGX sovereign wealth fund and Binance. Eric Trump confirmed that USD1 had been selected as the official settlement token for the transaction.
The decision sparked criticism due to Binance’s legal record in the U.S. In 2023, the exchange pleaded guilty to money-laundering violations and paid a $4 billion fine as part of its settlement with U.S. regulators.
Ethics experts and lawmakers reacted swiftly. Richard Briffault of Columbia Law School commented that Trump appeared to be “marketing access to himself as a way to profit from his ventures,” calling the situation “doubly corrupt.”
Senator Elizabeth Warren described the deal as “corruption,” pointing specifically to the MGX partnership as an example of how political stablecoins could be used by foreign interests to gain influence.
She also voiced opposition to the GENIUS Act, a pending bill focused on stablecoin oversight, warning that it could allow politically connected families to exploit gaps in financial regulation. Despite the criticism, the Senate passed the GENIUS Act on Jun. 17.
Crypto enforcement is now a political question
In February 2025, the U.S. SEC paused a civil fraud lawsuit filed in 2023 against Sun and the Tron Foundation. The case accused Sun of conducting unregistered securities offerings and manipulating token markets. The agency cited settlement discussions as the basis for halting proceedings.
The decision came shortly after Sun invested in World Liberty Financial and acquired a large position in the Trump-affiliated TRUMP memecoin.
The SEC’s move was not an isolated one. Over the following two months, the agency paused or dropped at least a dozen additional crypto-related enforcement actions.
In response, Senator Jeff Merkley introduced the “End Crypto Corruption” bill in May 2025. The legislation proposes restrictions on federal officials from participating in or profiting from crypto ventures while in office or after leaving public service.
The bill currently has 22 Democratic co-sponsors but faces little chance of advancing in a Senate where Republicans hold the majority.
Meanwhile, the public listing of Tron Inc. has drawn attention to the role of crypto firms in traditional financial markets. Reverse mergers, though permitted under U.S. law, are subject to added scrutiny, particularly when involving foreign sponsors or entities with past compliance issues.
Current SEC guidance mentions risks associated with such listings, especially in cases where investor protections or financial disclosures may be lacking. Any future charges could impact Tron Inc.’s public standing and investor confidence.
As Tron Inc. enters the public arena, it carries more than a token model. It carries a test of whether institutions will guard the line between private gain and public responsibility, or quietly step aside.
