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Is Trump's new 'Truth API' insider trading · DEEP INSIGHT

• 0:00
  Speaker 1: Imagine you are about to be offered the opportunity of
• 0:03
  Speaker 1: a lifetime. You get the privilege of peeking over Donald
• 0:06
  Speaker 1: Trump's shoulder as he types out stock market moving presidential
• 0:11
  Speaker 1: announcements like Iran's Ayatola has just been assassinated, or the
• 0:16
  Speaker 1: US is blockading the straight up four moves, or we're
• 0:19
  Speaker 1: jacking up tariffs on China so that you see these
• 0:23
  Speaker 1: announcements before the general public. But it'll cost you up
• 0:26
  Speaker 1: to one hundred thousand US dollars a month. Is that
• 0:30
  Speaker 1: ethical or never mind ethical? Is that even legal?
• 0:34
  Speaker 2: Trump Media and Technology Group has launched truth Api.
• 0:38
  Speaker 1: Fastest access to the president's post, to banks and some
• 0:42
  Speaker 1: other financial services firms.
• 0:43
  Speaker 2: Raising concerns of conflicts of interest, And of course, you know,
• 0:47
  Speaker 2: insider trading.
• 0:48
  Speaker 1: This is what everybody's asking now that one of Trump's
• 0:51
  Speaker 1: family businesses is apparently charging high volume stock traders for
• 0:56
  Speaker 1: early access to posts on truth social where Trump is
• 1:00
  Speaker 1: the most followed user. Let me try to tackle this
• 1:04
  Speaker 1: question of insider trading, because the answer isn't as straightforward
• 1:09
  Speaker 1: as you might think. But I'll also explain why I
• 1:12
  Speaker 1: think this question might miss the point entirely. Okay, so
• 1:21
  Speaker 1: the first thing to clear up here is what we
• 1:23
  Speaker 1: actually mean when we say early access to Trump's posts
• 1:26
  Speaker 1: on truth Social, Because if you only read the headlines
• 1:29
  Speaker 1: or even just heard me say it a moment ago,
• 1:32
  Speaker 1: it makes it sound like you can pay to see
• 1:34
  Speaker 1: the president's posts minutes or maybe even hours before they're
• 1:38
  Speaker 1: actually posted publicly. But no, what you're really paying for
• 1:43
  Speaker 1: is something more like seconds or even fractions of a second.
• 1:48
  Speaker 1: What Trump's company is calling truth Api is just offering
• 1:53
  Speaker 1: a way for people with money to plug in more
• 1:57
  Speaker 1: directly to truth Social, but to machine a new business
• 2:02
  Speaker 1: to business data feed with real time access to posts
• 2:06
  Speaker 1: from the highest ranking truth Social accounts, of which again
• 2:10
  Speaker 1: Trump is the highest of the high, promising to deliver
• 2:14
  Speaker 1: truth Social posts to our customers in milliseconds. So the
• 2:18
  Speaker 1: idea is, when Trump makes a post computers with this
• 2:22
  Speaker 1: API access that you can reportedly buy for somewhere between
• 2:25
  Speaker 1: sixty and one hundred thousand dollars a month, you think
• 2:28
  Speaker 1: of it like plugging right into truth Social servers. They
• 2:31
  Speaker 1: see the post almost instantaneously, unlike the rest of us
• 2:36
  Speaker 1: who are waiting for our Trump Truth Social feed to populate,
• 2:39
  Speaker 1: hitting the refresh button like a chump. So it's like
• 2:42
  Speaker 1: getting a front row seat as history is being typed.
• 2:46
  Speaker 1: Oh silly me. You can also use it to make
• 2:50
  Speaker 1: a ton of money, because who is this access really?
• 2:53
  Speaker 1: For high frequency and algorithmic trading firms that require a
• 2:58
  Speaker 1: low latency machine machine readable feed rather than manual tracking
• 3:03
  Speaker 1: translation computers that are smart enough to trade stock and
• 3:08
  Speaker 1: generate value without any human pushing any buttons. They're set
• 3:12
  Speaker 1: up to do it on their own, and they're fast.
• 3:15
  Speaker 2: The concept of algorithmic trading, which is basically computer based
• 3:19
  Speaker 2: trading where information is fee fed into an algorithm and
• 3:23
  Speaker 2: trades are executed based on that information, and so you
• 3:27
  Speaker 2: can react very quickly to new information, react instantaneously.
• 3:31
  Speaker 3: Let's just say there was an announcement of a new
• 3:34
  Speaker 3: tariff one hundred percent across the world. Everybody, everybody gets
• 3:36
  Speaker 3: into one hundred percent's hair. Well, I wouldn't like to
• 3:39
  Speaker 3: know that as fast as possible.
• 3:40
  Speaker 1: So to truth socials credit, they're pretty upfront about what
• 3:44
  Speaker 1: they're doing here. They're giving preferential access to Trump's posts
• 3:49
  Speaker 1: as president so that people who trade stocks where milliseconds
• 3:53
  Speaker 1: matter can get market moving information just a hair faster
• 3:58
  Speaker 1: than everybody else and there's a lot of market moving
• 4:00
  Speaker 1: information out there. Remember one of the posts I showed
• 4:03
  Speaker 1: you at the start more than a year ago, when
• 4:05
  Speaker 1: Trump announced a whopping one hundred and twenty five percent
• 4:07
  Speaker 1: tariff on China. Well, in that same post, he also
• 4:11
  Speaker 1: announced a pause on tariffs on much of the rest
• 4:14
  Speaker 1: of the world. That sense stock markets shooting up, And
• 4:18
  Speaker 1: if you were paying attention to Trump's feed, just hours
• 4:20
  Speaker 1: before that, he literally posted, this is a great time
• 4:25
  Speaker 1: to buy. He was right, and even as recently as
• 4:29
  Speaker 1: this weekend when the new API kicked in that same night.
• 4:33
  Speaker 1: In fact, this past Saturday, Trump very suddenly announced a
• 4:37
  Speaker 1: reverse course on an impending strike on Iran, saying the
• 4:40
  Speaker 1: US was going to hold off any attack surprise. And
• 4:44
  Speaker 1: then come Monday, crude oil prices tumbled with this imminent
• 4:49
  Speaker 1: threat of escalation off the table.
• 4:52
  Speaker 2: You know, just a small advantage, a small you know,
• 4:54
  Speaker 2: millisecond time advantage can be very profitable if you can
• 4:57
  Speaker 2: get ahead of the news before or other people make trades.
• 5:01
  Speaker 1: So is this insider trading when a very privileged class
• 5:07
  Speaker 1: of people get early access to this kind of money
• 5:10
  Speaker 1: making information. I'll give you two answers. Yes, it might
• 5:15
  Speaker 1: be insider trading when you think about how insider trading
• 5:18
  Speaker 1: is defined in US securities law as buying or selling
• 5:22
  Speaker 1: stock based on non public information that's been misappropriated.
• 5:27
  Speaker 4: Donald Trump, the President of the United States, has access
• 5:30
  Speaker 4: to confidential, non public the United States government, information about
• 5:35
  Speaker 4: what the Trump administration is going to do and a
• 5:38
  Speaker 4: wide range of areas truth social By giving advanced access
• 5:43
  Speaker 4: to the president's post in return for a pay amount
• 5:46
  Speaker 4: of money could be in violation of Bettle insider trading law.
• 5:50
  Speaker 1: So this is arguably insider trading if you see this
• 5:54
  Speaker 1: as white house information being monetized and then only giving
• 5:58
  Speaker 1: certain people special access. Democrats are certainly trying to make
• 6:02
  Speaker 1: this case, writing directly to the Chair of the Securities
• 6:05
  Speaker 1: and Exchange Commission that truth Api undermines everyday investors and
• 6:09
  Speaker 1: the integrity of our markets, while urging the sec to
• 6:13
  Speaker 1: immediately open an investigation. But this is arguably not insider
• 6:20
  Speaker 1: trading if there were never any secrets to begin with.
• 6:23
  Speaker 1: After all, everything's public, from how the truth api works
• 6:28
  Speaker 1: to who can get access, even the information itself literally
• 6:33
  Speaker 1: posted from Trump's thumbs publicly to the platform. Surely people
• 6:38
  Speaker 1: should be allowed to pay for speed if they wanted,
• 6:42
  Speaker 1: like an airline selling priority boarding or a shipping company
• 6:47
  Speaker 1: selling same day delivery, what's the difference in truth socials defense,
• 6:57
  Speaker 1: I should say there's nothing inherently various about an API,
• 7:02
  Speaker 1: any major company with data that it wants people to
• 7:04
  Speaker 1: be able to use effectively PAS one. It's how Uber
• 7:08
  Speaker 1: can show you a map of your city through Google
• 7:10
  Speaker 1: Maps API, and how Expedia plugging into various airline APIs,
• 7:15
  Speaker 1: can show you so many deals at once in real time.
• 7:18
  Speaker 1: And I can't help but wonder whether this preferential access
• 7:23
  Speaker 1: upsets the overall market balance much less than you'd think,
• 7:28
  Speaker 1: because those companies that already have access to the best
• 7:33
  Speaker 1: data scrapers, the smartest algorithms, the fastest bots that can
• 7:38
  Speaker 1: automatically and instantaneously execute thousands of trades in the blink
• 7:42
  Speaker 1: of an eye, with or without truth API, they were
• 7:46
  Speaker 1: already faster than everybody else. In one way, truth API
• 7:50
  Speaker 1: is like hitting my minivan against an F one car
• 7:54
  Speaker 1: and then giving the F one car a headstart. I
• 7:57
  Speaker 1: have news for you, they were already winning the race.
• 7:59
  Speaker 1: You can't be more first place than first place. And
• 8:03
  Speaker 1: for most people, being beaten to the best stock price
• 8:07
  Speaker 1: by one millisecond or two might not make a difference.
• 8:12
  Speaker 1: Where it does make a difference, though, is within that
• 8:16
  Speaker 1: ultra high speed Formula one class of high frequency, high volume,
• 8:22
  Speaker 1: heavily automated trading. Within that tier, Truth Social is creating
• 8:28
  Speaker 1: two tiers of ultra high speed, those who pay for
• 8:32
  Speaker 1: that extra millisecond and those who don't. And like I said,
• 8:35
  Speaker 1: in that speed class, milliseconds do matter if you can
• 8:38
  Speaker 1: flip a few thousand stocks in that time over your
• 8:41
  Speaker 1: next closest competitor. So who within that tier could afford
• 8:46
  Speaker 1: not to pay.
• 8:47
  Speaker 3: The ones who are the best of the best, and
• 8:48
  Speaker 3: the names that people see often see in the press,
• 8:51
  Speaker 3: they will have no choice but to buy that because
• 8:53
  Speaker 3: if they don't, their competitor will access the information sooner
• 8:57
  Speaker 3: than they will.
• 8:58
  Speaker 1: Even Trump's company itself acknowledge this. We are going to
• 9:01
  Speaker 1: create a lot of friction for those folks that aren't
• 9:04
  Speaker 1: coming to us directly. That's the interim CEO talking, arguing
• 9:08
  Speaker 1: the API will be significantly faster than scraping. And this
• 9:13
  Speaker 1: is where we come across what I think most experts
• 9:15
  Speaker 1: agree is the most problematic part of this truth Social API.
• 9:20
  Speaker 1: Fascinating because truth Social isn't just a social media site.
• 9:26
  Speaker 1: It is one of the US president's primary channels for
• 9:29
  Speaker 1: announcing the direction of US policy, which countries the US
• 9:33
  Speaker 1: will work with, even which countries the US is planning
• 9:36
  Speaker 1: to bomb. And this is a platform in which Donald
• 9:40
  Speaker 1: Trump has a clear financial stake. When I read through
• 9:44
  Speaker 1: Trump's financial disclosure for twenty twenty five, I can see
• 9:48
  Speaker 1: on this line of his assets and income Trump Media
• 9:51
  Speaker 1: and Technology Group, that's the company that controls truth Social
• 9:54
  Speaker 1: Trump owns more than one hundred and fourteen million shares
• 9:58
  Speaker 1: worth over fifty million dollar. This is about forty one
• 10:02
  Speaker 1: percent of the company. And this creates an ethical dilemma
• 10:06
  Speaker 1: like a bouncer holding a tip jar, because it is
• 10:10
  Speaker 1: no longer clear whether the president's announcements, his policies, even
• 10:15
  Speaker 1: his choices about how to communicate with Americans, whether they
• 10:20
  Speaker 1: are driven purely by civic duty or by money. What
• 10:25
  Speaker 1: is true in an absolute sense is that Trump is
• 10:29
  Speaker 1: more incentivized now to make decisions that make him money,
• 10:33
  Speaker 1: to generate value for those high powered stock traders who
• 10:37
  Speaker 1: have lined up to pay his family business one hundred
• 10:40
  Speaker 1: thousand dollars a month for preferential access to valuable information.
• 10:44
  Speaker 1: So when Trump posts We're close to a deal with Iran,
• 10:50
  Speaker 1: the US maybe, but Trump also knows there's money to
• 10:54
  Speaker 1: be made just by saying the words, whether they're true
• 10:58
  Speaker 1: or not.
• 10:58
  Speaker 4: I'm very much helping. The president will decide that his
• 11:02
  Speaker 4: priority for the remainder of his term is the interests
• 11:05
  Speaker 4: of the United States of America, not all his own
• 11:08
  Speaker 4: personal financial interests, or the financial interests or truth Social
• 11:11
  Speaker 4: or the other companies he owns.
• 11:13
  Speaker 1: And this is an open question that will linger long
• 11:16
  Speaker 1: after the sec or anyone decides whether truth API is
• 11:21
  Speaker 1: even legal to begin with.