Launched Friday night, Trump’s so-called “memecoin” surged from less than $10 on Saturday morning to as high as $74.59 before giving up some of its gains on Monday. The token, branded $TRUMP and criticized by ethics experts, was last trading at $33.88, according to cryptocurrency price tracker CoinGecko.
World Liberty Financial, a separate Trump-linked crypto project, also announced on Monday that it had completed an initial token sale, raising $300 million, and would look to issue additional tokens.
The expansion of Trump’s crypto interests comes as his administration is widely expected to usher in a “golden age” for cryptocurrencies, in stark contrast to the regulatory scrutiny the industry experienced under former President Joe Biden.
Bitcoin, the world’s largest cryptocurrency, hit a new record of $109,071 on inauguration day when Trump was sworn-in as the 47th U.S. President, but later pared those gains and was last trading at $101,867.40.
“The cryptocurrency market gained additional popularity in recent hours due to the launch of the TRUMP and MELANIA cryptocurrencies just before the inauguration,” said Grzegorz Drozdz, market analyst at Conotoxia Ltd, in a statement.
The Trump and Melania cryptocurrencies, the latter which was launched on Sunday, were created on the Solana blockchain.
The price of Solana’s coin also rose over the weekend, hitting an all-time high of $294.33 on Sunday.
“I think in the short term there’s a chance this could be a sell-the-news event,” said Matthew Dibb, chief investment officer at crypto asset manager Astronaut Capital, adding that crypto investors had been anticipating some executive actions to be rolled out during Trump’s first day in office.
“Bitcoin has already retreated … We are expecting further volatility here and likely a selloff.”
Trump’s crypto token launched on Friday, trading under $10, but quickly rose, peaking at $72.62 on Sunday. It traded lower on Monday, falling from $52.15 to trade in the $30 range late in the day.
Eighty percent of Trump coin’s tokens are owned by CIC Digital, an affiliate of Trump’s business, and another entity called Fight, Fight, Fight, according to its website.
It says the coins are “an expression of support for, and engagement with, the ideals and beliefs embodied by the symbol ‘$TRUMP'” and are not an investment or security.
The launch of World Liberty Financial just two months before November’s U.S. election caused concern over ethics and conflicts of interest. The launch of Trump’s “memecoin” on Friday night also raised red flags, even among those in the cryptocurrency industry. Several key figures in Trump’s administration and his circles have ties to the crypto industry.
“While it’s tempting to dismiss this as just another Trump spectacle, the launch of the official Trump token opens up a Pandora’s box of ethical and regulatory questions,” said Justin D’Anethan, an independent crypto analyst based in Hong Kong.
The Trump Organization said this month the president would hand daily management of his multi-billion-dollar real estate, hotel, golf, media and licensing portfolio to his children when he entered the White House. Trump’s net worth is estimated by Forbes at $6.7 billion, although that does not include his crypto ventures.
SPECULATIVE ASSETS
Excitement over expected executive orders, and other policy actions, that could kickstart a sea change in U.S. cryptocurrency policy have helped turbocharge crypto prices in recent months — although Trump did not announce any new policies on Monday as many in the industry had hoped for.
“The market has some great expectations about a bitcoin strategic reserve and a loosening of regulations around digital assets, but it’s more likely these developments will be drip-fed over a series of months rather than days,” said Dibb.
The huge rise in the new coin prices prompted concern among some analysts.
“Meme cryptocurrencies, like these, are prone to large fluctuations and we generally consider them as speculative assets,” Drozdz at Conotoxia said.
Trump’s coin represented a blending of the world of digital assets into the political arena, but it also “blurs the lines between governance, profit and influence,” D’Anethan said.
By Reuters
