According to Vitaly Portnikov’s apt words, Donald Trump fills the entire space around him. There seems to be no area left where he would not try to extend his influence and miss an opportunity to earn reputational or financial dividends. The cryptocurrency market, which the newly elected owner of the Oval Office seems to want to make his fiefdom, was no exception.
IA “FACT” already wrote that on the eve of the inauguration of the 47th US president, the memcoin $Trump, launched by the president-elect on the Solana blockchain, became one of the most successful launches in the crypto world. Ahead of the inauguration, First Lady Melania Trump also unveiled her $MELANIA token.
In a few days, $TRUMP reached peak price of $75 per token, and its market capitalization exceeded $14 billion. $MELANIA has also grown rapidly, reaching a market capitalization of $2.2 billion. However, after the inauguration of the crypto tokens of the Trump couple fell down by 60%. Pretty symptomatic, isn’t it?
$TRUMP and $MELANIA memcoins are complementary to Trump’s NFTs, shoes and books
These memcoins have no real intrinsic value and are positioned as digital collectibles and expressions of support rather than investment opportunities. However, the launch of crypto tokens by the Trump couple caused resonance in the cryptocurrency community and among ethics experts, raising new questions about possible conflicts of interest. Despite the promise of handing over business management to children, experts believe that the crypto-asset can attract significant funds without proper transparency.
The companies behind the $TRUMP and $MELANIA tokens call them an expression of support, not a financial instrument. These initiatives complement Trump’s other products – NFTs, shoes and books. But ethics experts say the situation is complicated by Trump’s role in regulating an industry in which he now has a financial interest.
Two companies linked to the Trump Organization control 4/5 of the tokens, which can bring significant profits. Some analysts emphasize the weak control of the crypto market and possible threats to national security, including the risk of foreign influence.
Investors see the move as an attempt to legitimize the crypto industry, although memtokens remain mostly volatile and speculative assets. On Monday, the cryptocurrency market showed high activity, and some experts noted that Trump’s token could change the approach to the field, making it more visible.
How the crypto community assesses the impact of Trump’s memecoins on the image of cryptocurrencies and the risks to the industry
The launch of $TRUMP and $MELANIA memcoins for the Trump couple caused various reactions in the crypto community. Recent developments in the cryptocurrency market, in particular the launch of memcoins associated with the names of Donald and Melania Trump, have caused active discussion in society. Some market participants saw this as an innovative approach to involving the masses in political discourse, while others were concerned about possible financial manipulation and the blurring of the lines between politics and finance.
On the one hand, these tokens open the door to the world of digital assets for those who have not previously been interested in cryptocurrencies. Trump’s name adds recognition to the project, making it a possible entry point for newcomers. This may encourage them to further explore more stable and long-term digital assets. At the same time, the launch of cryptocurrencies can become a tool of political influence, strengthening the connection between the leader and his supporters. Memcoins not only popularize the digital economy, but also serve as a symbol of belonging to a certain movement, which strengthens the emotional connection between voters and political ideas.
However, this approach has its own risks. As a rule, memcoins are characterized by high volatility, which makes them vulnerable to financial manipulation. For investors who trust only the popularity of the name or brand, such an asset can turn out to be a trap. Sudden price changes can cause significant losses, especially for those who invested on a wave of enthusiasm. Critics, including Nick Carter of Castle Island Ventures, point out that the launch of such tokens risks damaging the reputation of both specific political figures and the crypto industry in general. According to him, such projects “open new depths of idiocy”.
Financial experts warn of the possibility of a “crypto bubble”, especially if these tokens remain without fundamental value. For example, the value of Trump Coin initially rose sharply, but later experienced significant fluctuations. The emergence of Melania Coin only added to the volatility, demonstrating that a political brand is no guarantee of financial success.
These projects also affect the general image of cryptocurrencies. Some investors, especially conservative ones, may lose confidence in digital assets if they are associated with risks or financial losses. The politicization of the cryptocurrency market causes division among users. Some see this as a way to democratize finance, while others believe that financial technology should stay out of politics.
Despite all the controversy, the launch of $TRUMP and $MELANIA coincided with a significant increase in the price of Bitcoin, giving the illusion of an overall positive impact. At the same time, it is difficult to determine unequivocally whether it was memcoins that caused such a jump, or whether it was just a coincidence. Either way, their volatility underscores the need for caution for investors and poses challenges for the cryptocurrency community.
While Trump’s token has become a target of criticism from Democrats due to ethical risks, Republicans in Congress are ready to push initiatives to grow the crypto economy. The new legislative proposals should strengthen the position of the industry and protect it from repressive measures.
At the same time, ethical experts worried a potential conflict of interest, as the Trump administration will regulate an industry in which it has a financial interest through new tokens. This raises the question of transparency and possible influence on political decisions.
The intrigue of the situation is added by the fact that earlier Trump spoke critically about cryptocurrencies, calling them a “fraud”. However, during his 2024 election campaign, he reversed course, embracing digital assets and planning to create a bitcoin reserve and appoint crypto-friendly regulators.
During his first term, Trump did not transfer his business assets to a “blind trust,” as presidents typically do, to avoid conflicts of interest. Instead, he handed over management of his business to his sons, drawing criticism from ethics experts.
Does this initiative make it necessary to strengthen the regulation of the crypto market?
The launch of cryptocurrencies by members of the Trump family raises questions of ethics, transparency and regulation of the crypto market. After all, political figures can manipulate investors’ funds or artificially increase the value of tokens. This can threaten the interests of inexperienced investors who are not aware of the high risk and volatility of the market. Ethical questions also arise regarding the boundaries between the state role and private entrepreneurial activity.
The Securities and Exchange Commission (SEC) can play a key role in addressing these issues. If $TRUMP or $MELANIA tokens meet the criteria of the Gowey test, they could be classified as securities, which would require registration and strict reporting requirements. If there is suspicion of market manipulation or misleading investors through misleading promotion or opaque investment terms, the SEC may initiate an investigation.
To avoid conflicts of interest and ensure a higher level of transparency, the SEC may propose special rules for crypto projects initiated by political figures. It is also possible that the regulator will introduce measures to limit speculative activity in order to minimize the risks of significant fluctuations in the value of tokens and prevent manipulative schemes.
… Memcoins have always caused mixed emotions and controversy in the cryptocurrency world. Their nature is a cocktail of in-jokes, pop culture references and often questionable economic underpinnings. It is because of this that their value can instantly soar to the sky or rapidly fall into the abyss, as it seems to have happened this time. Investors, carried away by ideas or emotional impulses, often ignore cold analysis. Such behavior can turn into serious losses, especially when the projects they rely on turn out to be bubbles.
The launch of Trump’s memcoins became a new word in the symbiosis of politics and business. At first glance, it seemed like a bold move that promised innovation. But behind the scenes of this high-profile show, there are serious challenges. How appropriate is it to weave political figures into the already volatile cryptocurrency world? Are such projects able to find a balance between attractiveness and responsibility? For success, it is necessary to take into account the interests of investors, providing them with protection, and at the same time work on the stability of the market, which already resembles a rocking ship in a storm.
Trump’s memcoins have become a vivid example, which is now closely watched by the entire crypto market. Some experts are optimistic, suggesting that the connection to a political figure will help maintain long-term interest in the token. Others are skeptical about the possibility of long-term success of such a project, emphasizing the high risks.
Tetyana Viktorova
