Trump’s new meme coin soars on his first day in office, lifts other tokens

PARIS/SINGAPORE - US President Donald Trump’s new crypto token soared to more than US$10 billion (S$13.6 billion) in market value on Jan 20, while enthusiasm over his crypto-friendly administration helped briefly lift Bitcoin to a new record.

Launched on the night of

Jan 17

, Mr Trump’s so-called meme coin surged from less than US$10 on the next morning to as high as US$74.59 before giving up some of its gains on Jan 20. The token, branded $Trump and criticised by ethics experts, was last trading at US$32.64, according to cryptocurrency price tracker CoinGecko.

World Liberty Financial, a separate Trump-linked crypto project, also announced on Jan 20 that it had completed an initial token sale, raising US$300 million, and would look to issue additional tokens.

The expansion of Mr Trump’s crypto interests comes as his administration is widely expected to usher in a

“golden age” for cryptocurrencies

, in stark contrast to the regulatory scrutiny the industry experienced under former president Joe Biden.

Bitcoin, the world’s largest cryptocurrency, hit a new record of US$109,071 on inauguration day when Mr Trump was sworn-in as the 47th US president, but later pared those gains and was last trading at US$101,867.40.

“The cryptocurrency market gained additional popularity in recent hours due to the launch of the Trump and Melania cryptocurrencies just before the inauguration,” said Mr Grzegorz Drozdz, a market analyst at Conotoxia.

The Trump and Melania cryptocurrencies, the latter of which was launched on Jan 19, were created on the Solana blockchain.

The price of Solana’s coin also rose over the weekend, hitting an all-time high of US$294.33 on Jan 19.

“I think in the short term there’s a chance this could be a sell-the-news event,” said Mr Matthew Dibb, chief investment officer at crypto asset manager Astronaut Capital, adding that crypto investors had been anticipating some executive actions to be rolled out during Mr Trump’s first day in office.

“Bitcoin has already retreated... We are expecting further volatility here and likely a sell-off.”

Mr Trump’s crypto token launched on Jan 17, trading under US$10, but quickly rose, peaking at US$72.62 on Jan 19. It traded lower on Jan 20, falling from US$52.15 to trade in the US$30 range late in the day.

Eighty per cent of Mr Trump coin’s tokens are owned by CIC Digital, an affiliate of Mr Trump’s business, and another entity called Fight, Fight, Fight, according to its website.

It says the coins are “an expression of support for, and engagement with, the ideals and beliefs embodied by the symbol $Trump” and are not an investment or security.

The launch of World Liberty Financial just two months before November’s US election caused concern over ethics and conflicts of interest.

The launch of Mr Trump’s meme coin on the night of Jan 17 also raised red flags, even among those in the cryptocurrency industry.

Several key figures in Mr Trump’s administration and his circles have ties to the crypto industry.

Mr Justin D’Anethan, an independent crypto analyst based in Hong Kong, said: “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.”

The Trump Organisation said in January the President would hand daily management of his multi-billion-dollar real estate, hotel, golf, media and licensing portfolio to his children when he entered the White House.

Mr Trump’s net worth is estimated by Forbes at US$6.7 billion, although that does not include his crypto ventures.

Speculative assets

Excitement over expected executive orders, and other policy actions, that could kick-start a sea change in US cryptocurrency policy have helped turbocharge crypto prices in recent months – although Mr Trump did not announce any new policies on Jan 20 as many in the industry had hoped for.

Mr Dibb at Astronaut Capital said: “The market has some great expectations about a Bitcoin strategic reserve and a loosening of regulations around digital assets, but it’s more likely these developments will be drip fed over a series of months rather than days.”

The huge rise in the new coin prices prompted concern among some analysts.

Mr Drozdz at Conotoxia said: “Meme cryptocurrencies, like these, are prone to large fluctuations, and we generally consider them as speculative assets.”

Mr Trump’s coin represented a blending of the world of digital assets into the political arena, but it also “blurs the lines between governance, profit and influence”, Mr D’Anethan said. REUTERS