
At the same time as bitcoin appears ready to make its way into many conventional investing portfolios, President Trump’s meme coin is receiving a lot of attention. Investors might be reminded of the reasons they first avoided the company.
The cryptocurrency sector is optimistic about the incoming Trump government. Trump has pledged to impose considerably less regulations than President Biden did and stated his goal of making the United States the “crypto capital of the planet.”
In the meanwhile, fresh investing options include spot Bitcoin (BTCUSD)
Interest has been rekindled by -0.50% exchange-traded funds, which helped push Bitcoin’s price above $100,000 for the first time in November. Bitcoin was trading at $104,800 late Thursday, barely below its all-time high of $109,115.
However, when Trump and his wife, Melania, introduced two meme coins last week, cryptocurrency enthusiasts might have received more than they expected. The value of the tokens, $TRUMP and $MELANIA, rapidly increased. Within hours after its January 17 launch, the market value of the $TRUMP coin momentarily reached $15 billion.
According to CoinMarketCap, a website that tracks cryptocurrency values, $TRUMP currently has a market value of over $7.1 billion, placing it third among meme coins after Dogecoin and Shiba Inu. With a market value of almost $350 million, $MELANIA is placed 17th.
These numbers simply represent the coins’ “circulating supply” worth. It is important to remember that trading is only possible for a small portion of the entire quantity of coins. The Trumps seem to own the remainder.
The president’s investment is worth $30 billion, according to the Wall Street Journal, although they point out that figure is purely speculative. Any attempt to sell the collection of coins would probably cause its value to plummet much more, it warned.
Apart from the fact that many cryptocurrency enthusiasts have voiced misgivings, it isn’t terrible for a week’s work. The manager of the well-known tech-focused ARK Innovation ETF ARKK, Cathie Wood, stated, “We have essentially avoided meme coins.”
-0.57% when asked on Bloomberg TV if she would purchase the coin. Will it be useful in any way? We’ll see.
A request for comment via email from Barron’s was not immediately answered by the White House. During a recent news conference, Trump appeared to only manage a mediocre response when asked about the coin. “Aside from the fact that I launched it, I don’t know much about it,” he stated. “I’ve heard it worked.”
The coins are released at a critical juncture in the cryptocurrency movement’s attempt to gain traction. The industry has been trying for years to recreate the thrill and enchantment of the early 2020s, when Bitcoin’s market value first reached $1 trillion. Crypto never went away, but public interest was drained by falling prices and scandals like the collapse of Sam Bankman-Fried’s FTX exchange.
The Trump administration now pledges to usher in a second crypto golden age. Mark Uyeda, who Trump appointed temporary director of the Securities and Exchange Commission on Tuesday, quickly pledged to form a crypto task force headed by Commissioner Hester Peirce, one of the agency’s most vocal supporters of cryptocurrency, while the Biden administration adopted a more cautious stance.
After spot Bitcoin ETFs gained traction in early 2024, investors can also anticipate a plethora of crypto-focused exchange-traded funds under Trump. The SEC is considering proposals for funds that own Litecoin, Hedera, Solana, and XRP.
Furthermore, the acceptability of cryptocurrency by regular investors, who have been hesitant to include it in traditional portfolios alongside equities and bonds, may be at a turning point. Commonplace wealth managers including Morgan Stanley MS, Bank of America, and Wells Fargo
+0.01% Permit financial advisors to include Bitcoin in customer portfolios upon request.
FAQ
President Trump and Melania Trump launched two meme coins, $TRUMP and $MELANIA, which quickly gained market value but also raised concerns in the cryptocurrency community. Critics worry that these coins lack utility, may be overhyped, and could harm the credibility of the crypto market as a whole.
The $TRUMP coin’s market value peaked at $15 billion shortly after its launch and currently stands at $7.1 billion, making it the third most valuable meme coin. The $MELANIA coin, meanwhile, has a market value of $350 million, ranking 17th among meme coins.
Many enthusiasts view these coins as speculative and lacking meaningful use cases. The fact that the Trumps reportedly control most of the coins’ supply has fueled fears of market manipulation and volatility if these holdings are sold off.
President Trump has expressed a desire to reduce regulations and make the United States a global leader in cryptocurrency. His administration has proposed initiatives like creating a crypto task force under the SEC, which may foster innovation and investment in the sector.
Meme coins like $TRUMP and $MELANIA attract attention and speculative investments, but they also risk undermining the credibility of the broader cryptocurrency market. Established investors and institutions may be wary of associating with a sector perceived as being driven by hype rather than utility.