Days out from his inauguration, which is currently taking place in the US, President Donald Trump announced the launch of memecoin $TRUMP, which debuted during the Crypto Ball in Washington DC.
Launched on Saturday afternoon (AEDT), the meme coin was trading at around US$59.55 by Monday afternoon, achieving a fully dilated valuation of almost US$60 billion.
Built on the Solana blockchain, $TRUMP debuted with an initial supply of 200 million coins, which is expected to grow to one billion over the next three years.
“Now, you can get your piece of history,” the meme coin’s official website reads, which also labels Trump as “the crypto President”.
In conversation with InvestorDaily, Magnet Capital’s co-founder Egor Sidelska described the rapid traction of Trump’s meme coin as “unprecedented”.
“The speed at which this thing picked up steam was the most aggressive I've ever seen,” Sidelska explained.
“Starting off, you could buy [$TRUMP] for about 16 cents, which was about a $160 million market cap…within the first half an hour, it went from 160 million to a billion. Within the first hour, it was $3 billion.”
Despite its overnight success, Sidelska underscored that $TRUMP does not hold intrinsic value, but serves as a "representation" instead.
“This whole thing is a joke, the tokenomics are horrible. Anyone that owns 80 per cent of the supply, it's doomed to fail. But, this is a meme,” he said. “This meme doesn't do anything, but it's a representation. It comes from [Trump].”
Even if the President converted just 10 per cent of his holdings to cash, the co-founder noted, it would provide a significant boost to his net worth.
“He almost doubles his net worth in the billions, that is an astounding amount of money,” he said.
More importantly, the coin’s launch signifies a changing of the guard into a more pro-crypto administration, and not just within the white house.
Namely, the now former chair of the US Securities and Exchange Commission (SEC), Gary Gensler announced in November that he would depart from the commission after an almost four-year tenure, effective 20 January.
In July, Trump promised to sack Gensler, echoing his broader plan to dismantle the current administration’s "anti-crypto crusade", signaling a shift in crypto regulation should he take office.
“Under Gary, it was impossible to do a token launch in the US. You would have got destroyed for it by the SEC. Now, the incoming president of the United States launches his own meme coin,” Sidelska explained.
“This isn't a well formulated, documented company that exists that is delivering value, that is now doing a private sale to sophisticated and professional investors. He literally put the token up for anyone and everyone to be able to participate. Someone sitting from Iran, from China, North Korea - it didn't matter.
“So now, all of those businesses that have been chucked out in the US have been welcomed back with open arms, and [Trump is] kind of leading the way for that.”
Gambling or investing?
Following the meme coin’s launch, deVere Group chief executive Nigel Green warned that $TRUMP is “more gambling than investing”.
“This is a revival of the meme coin trend we saw in 2021 and 2022, where many young, inexperienced investors got burned by extreme volatility,” Green explained.
“Without doubt, investors will get burned by this frenzy too.”
Moreover, the deVere CEO underscored the speculative nature of meme coins, warning that their valuations can fluctuate wildly.
“If you’re considering getting involved, you need to have a sound, diversified, long-term plan in place first,” he said.
Expounding on this, Green highlighted that meme coins like $TRUMP are driven less by fundamentals, and more by the hype surrounding them. According to him, many day traders are likely piling in with hopes of capitalising on the “fear of missing out”.
“They’re mostly not buying because they think the coin has inherent value,” he continued. “They’re buying because they hope others will drive the price higher, allowing them to sell at a profit.”
“Understand the real risks to your money. This is not the same as investing in sound assets. Gambling is not the same as investing.”
Nonetheless, Green remains optimistic about the implications of Trump’s coin for the broader crypto market, explaining that, if Trump delivers on his pro-crypto administration, the adoption of digital currencies and blockchain technology could accelerate.
“This will have long-term benefits for the economy. But it’s important to distinguish between speculative meme coins and legitimate digital assets that provide real value and utility,” he said.
“If you do want the thrill or novelty of chasing big gains, ensure it’s part of a diversified strategy and not your main plan.
“Trump’s presidency is expected to usher in an era of pro-crypto policies, and while this could pave the way for legitimate growth for established assets like bitcoin, it also raises questions about the risks of speculative trading driven by social media hype,” Green concluded.
The price of bitcoin also rallied over the weekend, breaching the US$100,000 mark once again, after a brief slump.
