This week, a relatively unknown cryptocurrency company with some very high-level political connections will finalize a multimillion-dollar merger with another firm that could lead to a cash payout for Secretary of Defense Pete Hegseth. On October 8, INX Digital Company, a crypto exchange that’s publicly traded in Canada, will finish being acquired by Republic, another fintech company. The deal is worth up to $60 million and will lead to direct cash payouts for all holders of the INX token. Following the merger, INX will liquidate a $34 million cash reserve fund and distribute the proceeds to INX owners. Holders of the token, which currently trades at about 35 cents, will receive a prorated portion of the $34 million.

Hegseth might be among those token holders waiting for a windfall. In 2018, he was one of several people appointed to INX’s advisory board, and an April 2018 SEC filing said that “100,000 INX tokens were granted to Mr. Pete Hegseth.” The following year, another SEC filing stated that Hegseth was given the option to buy 100,000 INX tokens for $0.01 each. Public blockchain data shows that a crypto wallet linked to INX distributed tranches of 100,000 tokens to a number of recipients. Some of those wallets still hold their tokens, which would be worth about $35,000 at current market price—not taking into account the dividend from the cash reserve fund that is about to be distributed to INX token holders.

In his latest financial disclosure report, filed in December 2024, Hegseth listed millions of dollars in income and assets, including stocks, book royalties, speaking fees, real estate, and his $4.6 million salary from Fox News. He also listed a Coinbase wallet, which, according to the disclosure form, contained up to $50,000 worth of Bitcoin. He did not mention owning any other kinds of crypto tokens, although in an appearance on Jesse Watters’s Fox News show on May 4, 2021, Hegseth “proselytize[d]” about the importance of Ethereum, another major token that trades on the same blockchain that hosts INX tokens.

“Secretary Hegseth divested from all cryptocurrencies before taking office,” wrote chief Pentagon spokesman Sean Parnell in a statement to The Nation. That would mean that Hegseth sold the Bitcoin listed on his December 2024 disclosure form, along with any INX or other tokens.

Republic acknowledged receiving a list of questions but did not provide responses by press time.

Hegseth has been a longtime crypto booster, touting tokens on Fox News to his sometimes baffled colleagues. “I am a crypto evangelist,” Hegseth said on Fox Business on November 13, 2024. “I believe it is the future.”

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For at least four years, Hegseth’s association with INX was public, but at some point it seems to have been partially obscured. In 2019, Hegseth was listed on INX’s website as one of the company’s advisory board members. By November 2022, INX had removed the list of advisory board members.

On Oct. 1, 2020, without mentioning his relationship with the company, Hegseth posted on Twitter praising and linking to a group of videos made by INX. “Worth watching,” wrote Hegseth. “I really like their vision of the future of finance.” He eventually deleted the tweets.

Hegseth’s LinkedIn profile mentions a number of jobs and affiliations, but not INX. On Instagram, he follows the @INXLimited account. According to scraped public data from Telegram, the messaging app popular with crypto traders, an account named @PeteHegseth was in a group called INX Community.

INX has branches in Canada, Delaware, and elsewhere, but the firm was originally incorporated in November 2017 in Gibraltar—a notorious tax haven that has been a favorite of crypto companies. Its founder is an Israeli entrepreneur named Shy Datika, who did not respond to a list of questions about his relationship with Hegseth and any work the defense secretary may have done for the company. Datika’s previous company was a binary options trading firm called anyoption, which was based in Cyprus. Binary options trading is an extraordinarily risky, fraud-prone type of investment contract that has been outlawed in many jurisdictions, including Israel, which was once a center of the practice.

In 2015, Canadian authorities issued an investor warning that anyoption, then doing business under the forbidding name Ouroboros Derivatives Trading, was trading securities without a license in the country. Anyoption also received regulatory warnings in Argentina and Italy. In 2017, as the legal markets for binary options trading were dwindling, Datika reached an agreement to merge his company with Invest.com, a trading site run by a leading Israeli crypto entrepreneur named Moshe Hogeg, who soon became renowned as the county’s leading crypto scammer. Datika and Hogeg sued each another in actions claiming that their former partner had committed all manner of malfeasance. Hogeg went on to be arrested by Israeli police for his alleged role in a $290 million crypto scam; his prosecution is still pending. Datika went on to found INX.

It’s not clear how Datika and Hegseth met or what expertise Hegseth, who described himself on Fox News as more of a “crypto enthusiast” than an expert, would bring to a company advisory board. But if, as the Pentagon claims, Hegseth divested himself of all cryptocurrencies, including INX tokens, then he long ago cashed out to the tune of tens of thousands of dollars for a no-show job. For a Fox News–minted millionaire, that’s just walking-around money.