Donald Trump’s meme coin Value Increase
The Trump family’s entry into the crypto world has sparked a wider rally, with bitcoin reaching a record $109,071.86 in early trading before settling around $105,297.
Donald Trump’s newly launched cryptocurrency, $TRUMP, has taken the market by storm, reaching over $10 billion in value just as the former president was sworn in for his second term. In an extraordinary move, Trump had introduced the “meme coin” ahead of his inauguration, sparking billions in trading volume and capturing the attention of both supporters and critics.
The digital token, which Trump introduced on Friday, soared from less than $10 on Saturday to as high as $74.59 before giving back some gains on Monday. By early afternoon, it was trading at $45.21, with a market cap of more than $9 billion, according to CoinMarketCap. The launch has fuelled a wave of excitement in the broader cryptocurrency market, pushing bitcoin to a new all-time high.
Why did Trump take a dive into the crypto market?
Marketed as a symbol of Trump’s ideals and beliefs, $TRUMP has quickly gained traction. The coin’s branding includes imagery related to Trump’s assassination attempt in July, and supporters have rallied around it as an expression of loyalty. However, the Trump Organization has been quick to point out that $TRUMP is not an investment or security, urging participants to see it as a token of support rather than a financial product.
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Four-fifths of $TRUMP’s supply is owned by CIC Digital, an affiliate of Trump’s business empire, and another entity called Fight, Fight, Fight. While some in Trump’s base have embraced the coin, others in the cryptocurrency community have raised concerns about its speculative nature. Justin D’Anethan, an independent crypto analyst, warned that the launch opens a “Pandora’s box of ethical and regulatory questions,” news agency Reuters reported.
Melania Trump launches $MELANIA coin
Not to be outdone, Melania Trump launched her own cryptocurrency, $MELANIA, just a day after her husband’s. The former first lady’s token quickly gained ground, surpassing $1 billion in market value. Both Trump family coins are built on the Solana blockchain, a lesser-known network that has seen a sharp rise in its coin price since the launches. Solana reached an all-time high of $294.33 over the weekend, driven in part by the growing interest in these new tokens.
The Trump family’s entry into the crypto world has sparked a wider rally, with bitcoin reaching a record $109,071.86 in early trading before settling around $105,297. The rise has been fuelled by expectations that Trump, now back in power, will support looser regulations on digital assets, benefiting the entire cryptocurrency market.
Regulatory concerns
The meteoric rise of the $TRUMP and $MELANIA tokens has drawn both praise and concern from market observers. Peter Schiff, chief economist at Euro Pacific Asset Management, described $TRUMP as the new “digital gold” on social media, while other analysts cautioned that meme cryptocurrencies are highly speculative and prone to wild fluctuations. Grzegorz Drozdz, an analyst at Conotoxia Ltd, warned that while the coins have gained popularity, they should be seen as speculative assets rather than sound investments.
Trump’s presidency has reignited debates over cryptocurrency regulation, with some analysts predicting that his administration could remove regulatory barriers to digital assets. “Should public figures with such political clout wield this kind of sway in speculative markets?” D’Anethan asked, suggesting regulators may soon step in.
Donald Trump’s meme coin, also known as “TrumpCoin”, gained attention in the cryptocurrency world in late 2021 and 2022, capitalizing on Trump’s popularity and the surge of meme coins in the broader crypto market.
What Is a Meme Coin?
Meme coins are a type of cryptocurrency often created as a joke or based on internet memes or trends, rather than a legitimate technological innovation. These coins tend to rely heavily on social media and community engagement for value and popularity, rather than solid, underlying utility or business applications. The most famous example of a meme coin is Dogecoin, which began as a joke based on the popular “Doge” meme.
TrumpCoin: The Origins
TrumpCoin was not officially launched by Donald Trump himself, but rather by a group of supporters who aimed to combine his political persona with the viral nature of meme coins. It was created in 2016 during Trump’s first presidential campaign, initially as a way for his supporters to show their allegiance to him in a modern, tech-savvy way. The coin’s branding and symbolism are tied to Trump’s image, using slogans and themes from his campaign, including his signature phrases like “Make America Great Again.”
Though not endorsed by Trump or his official campaign, the coin attracted attention due to its association with the then-presidential candidate. It’s worth noting that the coin has fluctuated in value based on shifts in public interest, celebrity endorsements, and overall trends in the meme coin market.
The Rise of Meme Coins in 2021 and 2022
The meme coin craze saw a significant boost in 2021 and 2022, with coins like Shiba Inu and Doge hitting record highs. During this period, several meme coins related to celebrities and internet culture emerged, and TrumpCoin attempted to ride this wave of popularity. It was marketed to Trump’s supporters, offering a way to show their loyalty to the former president in the crypto space.
However, like many meme coins, TrumpCoin faced challenges in maintaining consistent value and widespread use. The price often mirrored the volatility of the broader meme coin market, which is driven by speculation, hype, and social media trends rather than intrinsic value or adoption by mainstream financial institutions.
Criticisms and Concerns
Despite the attention and excitement around meme coins like TrumpCoin, they have been subject to significant criticism:
Lack of Utility: TrumpCoin and many other meme coins lack the technological or practical utility that underpins more established cryptocurrencies like Bitcoin or Ethereum. Their value is driven primarily by hype, community sentiment, and social media activity, making them highly volatile.
Speculative Nature: Meme coins can be highly speculative and risky investments. Investors may be drawn in by the promise of huge returns, only to face sharp price declines once the hype fades or the broader market shifts.
Celebrity Endorsements: Many meme coins are linked to celebrity names or brands but aren’t directly endorsed by the individuals they reference. This can create confusion or lead to legal and ethical concerns, especially if there’s no official support or oversight from the celebrity.
Pump-and-Dump Schemes: The volatile nature of meme coins also makes them susceptible to “pump-and-dump” schemes, where prices are artificially inflated by coordinated buying efforts and then quickly sold off for profit, leaving unsuspecting investors with losses.
