UAE-linked investor granted privileged access to purchase US advanced AI chips following geopolitical realignment and defense partnership support.
The Commerce Department announced on Friday that it will grant the United Arab Emirates license-free access to cutting-edge AI chips and other crucial technology. The decision has sparked immediate criticism from lawmakers and observers who argue the Trump administration is extending preferential treatment to the Gulf nation because one of its royals invested heavily in a Trump family cryptocurrency venture.
G42, the U.A.E. company that will benefit from the new export policy, is chaired by Sheikh Tahnoon bin Zayed Al Nahyan, the country's national security adviser. Four days before President Trump's inauguration, a Tahnoon-backed entity reportedly spent $500 million to acquire a 49 percent stake in World Liberty Financial, the Trump family's cryptocurrency startup—a transaction that immediately transferred $187 million to Trump entities and significantly bolstered the family's crypto holdings.
Democratic Senator Elizabeth Warren characterized the Commerce Department decision as a "corrupt deal" in a statement Friday, calling on Commerce Secretary Howard Lutnick and Under Secretary Jeffrey Kessler to testify before her committee. "Congress should not pass any crypto legislation that does not stop the President and his family from continuing to profit off of crypto," she wrote.
The Commerce Department justified the arrangement by citing the "UAE's status as a U.S. Major Defense Partner and its support in advancing U.S. national security interests," including its assistance during operations in Iran. The announcement aligned with terms of an export agreement finalized between the two countries in May of last year.
Critics warn the deal poses significant national security risks. Chris McGuire, a former Biden administration official who overseeing tech policy, characterized it as posing "massive national security risks" and predicted it would slow U.S. AI development by encouraging the world's largest data centers to be built in the UAE instead of America. Others highlighted G42's previous partnerships with Chinese tech giant Huawei, arguing the agreement could indirectly provide Beijing access to sensitive American technology.
Proponents of the arrangement counter that the U.S. lacks the political will, electrical grid capacity, and streamlined permitting necessary to build all required compute infrastructure domestically. Ryan Fedasiuk of the American Enterprise Institute argued that international partnerships are essential for the global AI buildout, and it is preferable that U.S. firms and allies lead the effort rather than China.
A G42 employee held a position at World Liberty while the export agreement was being negotiated, according to the New York Times, though all parties have denied any conflict of interest influenced the deal. Trump's recent financial disclosures revealed he earned more than $1 billion last year from his family's crypto companies. Part of that came through MGX, another Tahnoon-led entity, which invested $2 billion in World Liberty tokens into Binance, whose founder Trump later pardoned. MGX is also among the new owners of TikTok's U.S. operations following the Trump administration's intervention.
In 2022, U.S. intelligence agencies reported that the UAE transferred technology to Huawei through G42 that enhanced China's air-to-air missile capabilities, according to the Financial Times. G42 denied the report at the time, calling it "false and defamatory." The company subsequently severed ties with Huawei as part of a 2024 investment arrangement with Microsoft.