- Trump Meme Coin plummets 78% from peak; investors lose over $2 billion USD.
- Trump Organization and entities behind the coin have reportedly made over $100 million USD ($160 AUD) in trading fees.
- One trader turns 18-cent tokens into about $110 million USD ( $175 million AUD).
Whether you love it or hate it, crypto is the financial Wild West of our time. Bitcoin surged to an all-time high recently, surpassing the $100,000 USD mark, and the entire crypto market reached a value of nearly $3.5 trillion USD. But where there’s hype, there’s always risk.
The crypto sphere has also been hit by its fair share of scams, including that of one-time “Crypto King” Sam Bankman-Fried, who is now serving 25 years in prison after defrauding investors of $8 billion USD. But this time, the controversy isn’t coming from some tech-bro or a rogue trader — it’s coming straight from the world’s most powerful man, the president of the US, Donald J. Trump.
The Presidential Pump
On January 17, 2024, just three days before his second-term inauguration, Trump’s meme coin, $TRUMP, hit the market which he announced and prompted on X. Unlike Dogecoin (another meme coin), which has its own blockchain, $TRUMP is just another digital asset often created purely for speculation and riding on cultural phenomena.
Meme coins are also notorious for their volatility and short-term nature, often a vehicle for “pump and dumps” in which creators stock up on tokens, gain popularity, and sell out, financially destroying ordinary investors in the process.
From Boom to Bust
At first, the hype machine did its job. Within days, $TRUMP skyrocketed from under $10 to $75. Social media was flooded with stories of people making thousands overnight. Then came the crash. Within days, it plunged to $40. Then $30 and eventually $16, losing 78% of its peak value. In total, over $2 billion USD of 800,000 investors’ money vanished, just like that.
To be fair, the Trump coin website had a disclaimer buried in the fine print: “Trump Memes are intended to function as an expression of support for, and engagement with, the ideals and beliefs embodied by the symbol’ $TRUMP’ and the associated artwork, and are not intended to be, or to be the subject of, an investment opportunity.”
But clearly, that message didn’t reach investors, and a billion more $TRUMP tokens will be released in three years. All we can say to investors is: Good luck.
However, some people do seem to have come out on top. The Trump Organization and its subsidiaries reportedly profited more than $100 million USD in trading fees alone. And according to The New York Times, one lucky investor managed to converted an 18-cent-per-token bet into a $110 million ($175 million AUD) gain in a matter of days.
A Family Affair
If Trump launching a meme coin wasn’t enough, Melania Trump decided to get in on the action, too. Just a day before her husband’s inauguration, the First Lady introduced her own token, $MELANIA. Unlike $TRUMP, Melania’s coin peaked at $13 before crashing to under $2 — a different scale but still yet another crypto rollercoaster ride for investors.
The Ethical Storm
Both $TRUMP and $MELANIA had their launch immediately met with backlash. A soon-to-be US president initiating (and profiting from) a speculative investment. It’s the kind of headline that newsrooms across the world have captured. With Trump’s administration hinting at major crypto deregulation, critics expressed concerns over a potential conflict of interest.
The consumer advocacy group Public Citizen has already filed ethics complaints, arguing that Trump’s $TRUMP promotion on X violates federal laws against a president soliciting public gifts. Yet, even if the Trump Organization cashed out today, they’d walk away with billions.
So if you’re in cryptocurrency, recall that even presidential meme tokens can’t escape the age-old formula of a small number of winners and a large number of losers. The secret to going forward is not to ride the wave of hype but to be informed, manage risk in a sensible manner, and invest in just that which you can afford to lose — because in the volatile world of crypto, hype is a flash in the pan, but losses linger.
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