When Donald Trump won the presidency in November, many crypto fanatics celebrated, based on his promises to the industry that he would prioritize deregulation and legitimize crypto entrepreneurs. Days before his inauguration, industry heavyweights gathered in Washington for the Crypto Ball, celebrating their newly minted status as D.C. insiders.
But during the event, Trump shocked nearly the entire room by posting online about the launch of a new cryptocurrency called TRUMP. This new currency, a so-called meme coin, has no inherent value, but rather fluctuates in price as people buy and sell the coin. Trump’s fans and opportunistic day traders have generated billions of dollars in sales, driven by loyalty, hype, and the chance to make a quick buck. All of these trades have made the coin’s creators—affiliate companies of the Trump organization—billions of dollars on paper. A day after its release, Melania Trump announced her own meme coin, which also rose and fell in crazed spurts. On Wednesday, TRUMP was the 25th most valuable cryptocurrency in the world, according to CoinMarketCap—although its price of about $43 was well off its $75 high. Trump’s meme coins brought a surge of attention to crypto and many newcomers into the space.
To some, the coins signaled Trump’s commitment to crypto and to spurring its growth. But many more in the crypto world responded with revulsion to what they saw as a cash grab, and a way for Trump to directly profit off of his followers. Trump’s team holds at least 80% of the coin’s supply, giving them vast power to control its price. While they are not allowed to sell off their holdings for months, doing so would crash the market and leave regular users with a loss.
Crypto insiders worry that the coins will make the public even leerier of an industry already filled with scams and bad-faith actors. “The crypto sector put someone in power whose first act is to emphasize and take advantage of the opportunity for grift within crypto,” says Angela Walch, a crypto researcher and writer. “And that's just embarrassing.”
Trump has downplayed his role in launching the coin, saying at a Jan. 21 press conference: “I don’t know much about it other than I launched it.” The Trump Organization did not immediately respond to a request for comment. A White House press officer declined to comment. But elected officials and legal experts are raising ethical and geopolitical concerns about the tokens, which they say could serve as a vehicle for bribery and conflicts of interest. “These coins open a channel for him to receive financial benefits from foreign adversaries and to prioritize his personal interests, to the collective detriment of Americans,” says Puja Ohlhaver, a lawyer affiliated with Harvard’s Allen Lab for Democracy Renovation.
