Trump Memecoin’s ‘money-grab’ economy

In this sense, claims Jacob Silverman, its co-author Easy Money: Cryptocurrency, Casino Capitalism, and the Golden Age of FraudThe TRUMP Coin setup appears to bear some of the hallmarks of a “classic memecoin pump-and-dump”—a strategy whereby an issuer holds a large amount of their coin, promotes the project, then cashes in their holdings, devaluing the currency and Other investors face huge losses. Dump on the public or some kind of sell off that major would be just huge. That’s a huge red flag,” Silverman complained. “Unfortunately, some poor sap will get wet.” (Pump-and-dumps occupy some of the a Legal gray arealegal experts say, but is condemned as morally dubious.)

Melania Trump’s decision to launch her own MemeCoin already appears to have dealt a blow to TRUMP investors, even absent a potential pump-and-dump. After Melania Coin goes live, Trump Token 50 percent price reduction.

A litany of unofficial Trump-inspired memecoins—among them maga, Six yourself, Doland Tramp And Super Trump-The price has also decreased. During the 2024 election, political memecoins were used as a Proxies for betting on election results and expressing support for a particular candidate, ebb and flow with events on the campaign trail. But TRUMP’s introduction inadvertently destroyed innovators who bought the unofficial currency as a sign of their support for Trump.

“I don’t think it’s appropriate for the president of the United States,” said Steven Steele, director of marketing for MAGA Tokens. video Posted to X. “It seems like a terrible money-hand.”

Perhaps more dangerous than the financial damage it inflicts on supporters, Trump may also serve as a new vector for memecoin bribery, Silverman contends. By investing large sums in a cryptocurrency in which Trump has a large financial interest, causing its price to rise, politically motivated actors could gain favor with the president without making any direct transactions, he alleged. “These are the kinds of channels for influence and leverage that we haven’t really seen before,” claims Silverman.

An official Trump memecoin release marks the latest development in the president’s ongoing flirtation with crypto. However, during his first term, Trump rejected Bitcoin as onescandal“He performed a complete volte-face in the lead-up to the 2024 presidential election. As the figurehead of the crypto industry support his presidency And Throw in hundreds of millions of dollars in grants On the Pro-Crypto Super Political Action Committee, Trump called himself “Crypto President“

Dr. spoke in July Thousands of Bitcoins At a conference in Nashville, Tennessee, Trump pledged to make the United States the “crypto capital of the planet” and establish a national “.Bitcoin reserves“If re-elected. Then in September, the Trump family helped launch a new crypto business, World Liberty Financial, which they pitched as a way to “make finance great again.” (It’s not yet clear what services World Liberty Financial will offer.)

World Liberty Financial was View with skepticism by some members of the crypto industry, who worry that the project could cause losses among investors and face lasting reputational damage if it fails. The same logic applies to the TRUMP memecoin. “It would be very bad if it completely blew up in a lot of people’s faces, because the media attention would be negative,” Bendixen said.

Yet for all the potential consequences, there’s little to stop Trump from testing the boundaries of what’s acceptable with crypto, Silverman said, as others have done before him. Especially as he SEC ready for overhaulFinancial regulator which Most enthusiastically follows the crypto industry Under the previous administration.

“In some ways, he’s just another crypto entrepreneur,” Silverman said. “He’s just going to be president.”