Every so often, my journo friend Jemima Kelly — who I consider one of the sharpest minds at the FT — pops into my WhatsApps to road-test her column ideas on me. She did so again last month. The request this time? Steel-man the case for the Trump family’s non-stop crypto shilling roadshow.
The outcome of our exchange appears to be a column titled Crypto skulduggery isn’t a bug, it’s the whole point.
Given the whole exchange expended a good wedge of my grey matter, and Jemima didn’t really lean on my points, I figured I shouldn’t let the thinking go to waste, not least because I’ve been making similar points in presentations and panel events the past two months.
What follows is a breakdown of why I think Trump’s self-interested crypto gamble is potentially defensible on a game-theoretical basis. For the record, I’m interested in the argument not because of an affinity for crypto or Trump, but rather because I find the underlying information and market dynamics interesting.
Corruption in plain sight
My contention: The Trump family’s embrace of crypto, whether consciously or not, suppresses far nastier predatory and destabilizing forces that might otherwise bring down the system.
The rationale: In a world already riddled with hidden corruption — from QE-driven asset inflation to rentierism and elite capture (including by the Trumps) — sometimes the best policy isn’t fighting corruption but making it obvious and participatory.
In that vein, the “Trump Pump” — by making the shadowy networks and schemes that influence the system brazen and upfront — establishes a new self-stabilizing market equilibrium.
It says to followers, “the corruption is real, but you’re in on it too, and that at least makes it fair, as you too can take advantage of it too”.
The outcome is a new norm powered by “authenticity” and focused on allowing everyone to take part in the grift — similar to how Pompey the Great reduced the pirate scourge during the Roman Republic by legitimizing the pirates, or when Sergei Mavrodi’s 1990s MMM scheme countered oligarchic corruption by playing them at their own game.
In fact, to better explain, it’s worth looking more closely at the story of Mavrodi.
Mavrodi, and the ‘people’s Pyramid’
Sergei Mavrodi was a fascinating fellow.
Part computer geek, part evil genius, part altruist, he came to prominence in the chaos of 1990s Russia — a time when oligarchs, mafia groups, and black-marketeers were tearing apart the fabric of post communist society, leaving many ordinary and honest Russians destitute.
This was a time when inflation was rampant, banks were mistrusted, and ordinary people were desperate for a way to preserve or grow their savings.
Disillusioned by the deep vulnerabilities at the core of Boris Yeltsin’s corrupt 1990s administration, as well as the lack of international concern about it, Mavrodi — a mathematics graduate from the Moscow Institute of Electronic Engineering — decided to fight fire with fire.
His solution was an audacious pyramid scheme called MMM that would champion the interests of “the people”, and which he would present as a new, democratic way to make money — a “people’s investment company” that promised returns of up to 1,000 percent a year.
Famously, Mavrodi did not financially benefit from the pyramid himself. He lived modestly throughout his operating years and eventually died in 2018 with little to no personal wealth to show for his efforts.
Throughout, Mavrodi described the scheme as a “mutual aid network,” not a get-rich-quick scheme.
The pyramid wasn’t “fair” by any stretch, but what made it compelling to millions of Russians was that it democratized access to returns in a way Russia’s crony privatizations never did.
Upon its formal launch in 1993, MMM gained traction with extraordinary speed. It had begun by selling the company shares of Mavrodi’s legacy computer business, bypassing the newly formed Russian stock exchange. Structured as a grey-zone operation, half legal, half fantasy: the “shares” were paper tickets with no real assets behind them, but they could be bought and sold at ever-increasing prices set by MMM itself.
The real secret to the scheme’s success, however, was Mavrodi’s knack for publicity. To augment sales, Mavordi — a born propagandist — orchestrated one of the most aggressive and psychologically clever advertising campaigns Russia had ever seen.
MMM commercials flooded television, radio, and newspapers. They were simple, emotional, and brilliantly targeted at ordinary people who had never invested in anything before. The most famous featured a fictional everyman named Lyonya Golubkov, a humble worker who became rich through MMM. In each ad, Lyonya would happily tell viewers how he had started with a small amount, bought shares, and now could afford luxuries — “I’m not a freeloader, I’m a partner!” became a national catchphrase.
The character’s down to earth style embodied the post-Soviet dream that anyone could suddenly get rich without connections or corruption.
By the summer of 1994, it was estimated that up to one-third of Russian households had invested. Even formal institutions like the Swiss embassy in Russia had invested.
In one of Mavrodi’s last interviews before his death in 2018, the Russian claimed MMM had only genuinely existed for six months but that despite the brief window, its operations had reached a size equivalent to roughly “a third of the country’s budget”.
And so, even as oligarchs continued to siphon value in the shadows, Mavrodi — an almost comedically disheveled figure — siphoned it back in the open, and in a way that allowed ordinary people to come along for the ride.
For the Russian authorities, the scheme soon became a nightmare.
They saw Mavrodi as both a criminal and a political threat — someone who had turned mass financial desperation into populist power. Mavrodi countered that he was only giving people what the government had failed to provide: hope and profit.
But what irritated authorities most of all about MMM was that it exposed a deeper social truth about the instability, cynicism, and despair of early post-Soviet life. Mavrodi didn’t just take people’s money — he held up a mirror to society, revealing how entrenched the corruption was. In doing so, he collapsed the fantasy that Russia’s capitalist transition had been a net good for all.
The scheme fell apart, of course, but not without significant collateral damage for Russia’s fledgling democratic institutions.
The people’s ‘champion’
MMM collapsed in 1994. But Sergey Mavrodi’s situation, while desperate, also ironically became uniquely powerful at this point. He had presided over the biggest pyramid scheme in Russia’s history, wiping out the savings of millions, yet paradoxically, he remained wildly popular among many of those same victims.
They didn’t see him purely as a criminal. Many believed he had been sabotaged by the government or that the authorities — not Mavrodi — were responsible for the collapse by shutting MMM down.
When prosecutors began investigating him, Mavrodi made one of the most daring tactical moves in Russian political history. He decided to run for a seat in the State Duma, the lower house of parliament.
Under Russian law, elected deputies enjoyed parliamentary immunity. They could not be arrested or prosecuted while in office. Mavrodi realized that if he could win an election, he could shield himself from the criminal charges piling up against him. The move, in effect, became a legal hack of the justice system.
The strategy worked. After framing his campaign as a populist rebellion against the government, and positioning himself as a man of the people who had been punished for trying to make ordinary Russians rich, Mavrodi won election as a deputy to the State Duma.
For the most part, the victory was merely political theater — he never intended to build a real party or participate seriously in lawmaking. Yet, for a brief moment, his election revealed the imperfections of the democratic system that Western interests had staked the future of the country on.
This infuriated the authorities even more.
As soon as Mavrodi’s Duma term expired, and with it his immunity, the state arrested him and convicted him of fraud.
But the damage was done. Mavrodi’s parliamentary “hack” had revealed that systems, whether financial or political, could always be gamed by those who understood their internal logic better than the people who built them. More so, in societies where the old moral rules had collapsed, democracy itself was potentially a source for instability.
In the end, Mavrodi showed he could “capture” the state by aligning his investors’ interests with his own political survival. To attack him was to attack their constituents. When the state tried to shut him down, it found itself constrained by the sheer number of citizens whose money — and hopes — were tied up in MMM.
The whole story is retold in the film PyraMMMida, where Mavrodi is portrayed less as a cartoonish villain and more as a clever, charismatic outsider who outsmarts the system.
Trump’s crypto play, I believe, channels similar logic. By pulling his followers directly into his own get-rich scheme, he’s not just enriching himself — he’s binding their fortunes to his. At both a personal and political level.
The more people ride the pump, the more politically costly it becomes to regulate or crack down on the strategy. What looks like a grift on the surface becomes, in game-theoretical terms, a survival strategy for everyone involved.
And, unlike Mavrodi, because Trump is the state, the grift never needs to stop —especially if it can be recalibrated to serve truly productive causes and begin to fund itself.
A self-stabilizing force?
The main question to consider is whether the strategy can indeed transform corruption from an exclusive racket into a potentially positive-sum public spectacle?
The answer, I’d argue, depends on how one perceives the system’s status.
If, like many people, you believe the system is beset by rampant corruption and that most institutions cannot be trusted, then the idea that everyone needs a vested interest in a new equilibrium to prevent further decline will probably make sense.
If, by contrast, you believe the current system is working just fine, chances are it won’t.
The key point, either way, is that efforts to repair a rotten system from the top down can only go so far. Once trust is gone, the only viable way to reengineer it is from the bottom up. That’s either by giving everyone a mutual interest in cultivating a new system of trust or by hijacking a pre-existing trust network and bending it to your own ends.
Trojan horse
As it stands, the system is collapsing under the weight of the very defenses it is bringing in to fend off collapse.
In 2024, the world’s largest financial firms poured some $200 billion into compliance efforts aimed at curbing crime.
Europe’s new Anti-Money Laundering Authority will set EU taxpayers back about €50 million a year when it becomes fully functional in 2028.
Neither of these figures account for the additional costs imposed on users and businesses at the secondary level via endless ID checks, repeated verifications, and mandatory reporting — all of which run into billions more.
All the while, fraud, state capture, and high-level criminality continue on largely undisturbed.
The outcome is a costly cat-and-mouse game that generates ever-greater diminishing returns the longer it goes on.
So how does one restore trust in a system that, by design or neglect, no longer inspires it?
In the classic prisoner’s dilemma, when a predator is caught out and is faced with the consequences of his actions, the rational choice is to snitch on any fellow collaborators, because protecting the network could lead to worse outcomes for himself.
In the real world, however, the calculus is rarely that simple. Once external pressures are added — reputational damage or the threat of violent retaliation — the payoff matrix changes. Suddenly, staying silent can become the safer, more rational strategy, because the costs of betrayal outweigh the immediate benefits. The prisoner may even have the capacity to corrupt the jailor.
That’s where the perverse logic of the ‘Trump pump’ comes in.
When ordinary institutional mechanisms are broken, it doesn’t pay to chase bad actors in the usual way. The predation is too opportunistic and survival-motivated.
What does make sense is binding ordinary people’s fortunes to the same risky assets that benefit the patron (or boss) of a corrupt network. When millions of small holders have skin in the game, regulating or shutting a predatory scheme down becomes politically and practically costly. In game-theory terms, you transform a private capture into a distributed interest that gives everyone an interest in supporting each other.
You might ask, what good is such a trust network if the underlying activity it supports is zero-sum, or worse still, negative-sum? Institutionalizing bad practice, after all, doesn’t engender growth.
This is a fair question.
The answer is that in a tightly coupled modern economy, such as ours, growth is impossible without recourse to a highly trusted base network at its foundation.
Building such trust networks from scratch is labor-intensive and time-prohibitive. That’s why, in our current urgent predicament, a more expedient strategy may be hijacking pre-existing negative or zero-sum trust networks and reprogramming them into positive-sum operations.
From that perspective, even if crypto currently does more harm than good, the networks that underpin the schemes still have the potential to be reoriented towards positive-sum activity with the right influence and guidance. This is all the more the case if there are broad profits to be had for all from doing so.
Hacking the trust system
Similar thinking is already being deployed in the biological realm.
Take viral vector vaccines as an example. These use a relatively harmless virus, or at least one that the body can tolerate, as a delivery system to bring genetic instructions into our cells to fend off much greater threats.
Via this process, the vector virus educates our cells about the features and attributes of much more dangerous pathogens. “We’re bad actors that feed off your efforts,” it says. “But check out these other bad guys, they’re even worse than us! They don’t just feed off you; they suck you dry and kill the whole system. It’s in our mutual interests to work together.”
The result is a temporary alliance between a lesser bad pathogen and our cells to eradicate the greater existential threat to the system.
The dynamic — leveraging a manageable threat to prepare for a larger one — serves as a useful metaphor for what’s going on with the Trump pump.
Crypto is not harmless; it brings with it scams, volatility, and speculative excess. It skims value from participants, often at the expense of the naïve or unprepared. Yet, much like the viral vector, its danger is bounded, especially if systemic implications are limited by its private resolution regime and the core system remains shielded from its negative influences.
At the same time, allowing the tolerable virus to operate and evolve in plain sight helps to educate participants and regulators about future risks that could impact the core system.
The idea, therefore, is not that criminality is now virtuous — far from it — but that when conventional institutions fail, the only functioning trust networks left behind may be those that evolved to police themselves.
Corrupt them into serving a stabilizing function: make them the Trojan horse by which a fragile, bottom-up stability can be rebuilt, and maybe, just maybe, the system can be tricked back into growth.
Every ‘bad guy’ wants to go legit
But there’s an additional twist.
Game theorists usually argue that society is most stable when everyone presumes that everyone else is a bad guy (aka a hawk, not a dove).
The problem with that scenario is that, as per the criminal economy, it tends to lead to negative outcomes for society and zero overall growth.
But as game theorist Steve Baigent at UCL once told me, there are exceptions to this case. “The only time you can get out of a hawk on hawk situation where everyone tends to lose, is by playing a game where nobody knows when the end is going to be, and then it’s possible to have cooperation evolving from that under the right conditions,” he explained.
Bitcoin may be a shared fiction. But if all the players involved in the bitcoin game believe it will only grow more valuable over an infinite horizon, then mutual self-interest kicks in to defend and grow the system. Call this the unbounded number goes up play.
The rational action then is not just to HODL, but for everyone to HODL and grow the pyramid. At this point, the incentive for the biggest stakeholders is to protect all HODLers from those who do not respect the “system” or those who think they are above it (like the authorities who want to shut it down or egregious hackers or thieves). This is because if too many new entrants get burned, the whole thing collapses, and so does the power of the early entrants.
In that context, the power of the “people’s champion” lies in his capacity to keep growing his holdings. But also to never cash out unless it’s to defend the system, like some sort of OPEC state set on withholding supply to keep prices aloft for the greater good of the network.
His refusal to sell becomes a form of market governance: a signal that forces others to hold the line. To defect is to crash the price, and by extension, the shared illusion that keeps everyone rich.
The next incentive, however, is to keep stakes broadly distributed, since any concentration of power risks turning the system hostage to a single actor — especially if their ideological commitments diverge from the group’s shared fiction.
And so, by engineering indefinite participation through HODL incentives, the scheme turns speculative actors into long-term cooperators around a shared fiction. Even if Bitcoin is a ‘fake asset,’ the coordination it generates can yield positive-sum real-world consequences, especially if those who acquire early stakes can, at a later stage, be convinced to invest their wealth into productive enterprises or offer others the chance to invest in themselves.
And funnily enough, this loops back to the origins of the mafia itself. The point of those early brotherhoods was not senseless criminality, but protection: Sicilian farmers banding together to shield themselves from the greater predations of the state. Like Robin Hood, these “bad guys” emerged because the “good guys” had become the bigger threat. The mafia’s solidarity networks — however compromised — provided a more trustworthy defense than corrupt officials ever could.
Seen in that light, Trump’s open grift echoes a much older pattern: when official institutions lose all credibility, order often gets rebuilt from below, through informal networks that begin as “bad” but end up serving as the only practical trust system left.
In this case, the more money Trump makes, the more money everyone invested in the system makes. Fortunes are aligned. And everyone has an interest in snitching on system destabilizers.
And in that way, the “bad guys” become the “not-so-bad guys”. Or at the very least, bad guys who recognize that their self-interest is better served by keeping the wider enterprise solvent.
Call it the Han Solo principle.
