Just days before Donald Trump’s inauguration, the new president of the United States launched a meme coin called $TRUMP. Melania Trump was soon to follow with the introduction of $MELANIA the evening before Trump took office.
The Trumps new meme coins have stirred a blend of backlash and excitement, which is evident in how fast the value of each coin gained value.
What is a meme coin?
Historically, meme coins are very unstable and volatile investments. They are primarily used to garner attention towards a viral internet sensation.
Investopedia defines meme coins as: A cryptocurrency named after characters, individuals, animals, artwork, or anything else in an attempt to be humorous, and light-hearted, and attract a user base by promising a fun community.
The aggressive and intense nature of Donald Trump’s entire brand doesn’t exactly align with airy and lighthearted. Yet, $TRUMP has already soared to $10 billion in market value (Reuters), making it the 19th largest cryptocurrency.
According to CoinMarketCap, 24-hour trading volume was nearly $40 billion. See live updates here.
$MELANIA reached a market value of $1.7 billion a few hours before the inauguration which has since dropped to $1 billion (CBC).
A Florida-registered company, MKT World LLC, owned by Melania Trump. The K comes from her previous surname name, Knauss. After 30 days, the owners can sell the coin themselves (The Guardian).
At this time, the amount of money Trump will earn from this pursuit is uncertain.
Timing is everything
CIC Digital LLC, an affiliate of the Trump Organization, coordinated Donald Trump’s crypto venture (BBC). The company has also sold other Trump-branded products like shoes and fragrances.
Trump posted the following on his social media platform, Truth Social, on Friday, Jan. 17th:
“My NEW Official Trump Meme is HERE! It’s time to celebrate everything we stand for: WINNING!”
CIC Digital LLC and, the recently established, Fight Fight Fight LLC, own 80% of the tokens. Around 200 million digital tokens have been released. Another 800 million will be issued over the next three years.
A disclaimer provided alongside the launch read that $TRUMP is “not intended to be, or the subject of” an investment opportunity or security and was “not political and has nothing to do with” any political campaign, political office or government agency.
Melania Trump’s meme coin website has a similar disclaimer, which has prompted both support and a collective eye roll among critics.
The irony is clear since the coins were dropped just before the inauguration. However, it’s also considered to be a brilliant strategy.
Conflicting perspectives
The cryptocurrency community is divided and has conflicting opinions about Trump’s move.
Some crypto enthusiasts applaud the Trumps’ meme coins, believing they’re symbolic of his support of crypto, especially in light of being “unfairly targeted” by the Biden administration.
Trump claims he is committed to creating crypto-friendly regulations and assigned key government positions to supporters of the crypto cause.
Many are hopeful that Trump’s administration will build the industry while others are skeptical and concerned.
“Trump owning 80 percent and timing launch hours before inauguration is predatory and many will likely get hurt by it,” posted crypto venture capitalist Nick Tomaino on social media (BBC).
Justin D’Anethan, an independent crypto analyst based in Hong Kong stated “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.”
Cryptocurrency lawyer Preston Byrne predicts a 90% probability of a civil lawsuit opposing the coin to occur within the next 14 days.
In his blog, Byrne writes: I am absolutely certain this will happen. Someone will lose money, some lawyer will come up with a theory and file.
Where will this go?
Digital tokens such as $TRUMP are notoriously used to generate hype and build value before selling at the top of the market, leaving latecomers at a loss as the price crashes (Reuters).
Time will tell the true purpose and intentions behind the coins — or will it. What do you think about $TRUMP and $MELANIA?
Are these coins a get-rich-quick scheme? Not that the Trump’s aren’t already wealthy. Or is it an effort to show support and gain further favour of the crypto industry?
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Image source: Gage Skidmore/FLICKR
