Donald Trump’s coin valuation skyrocketed by over 300% in less than 24 hours. As of Sunday morning, $TRUMP has hit a market cap of $5.81 billion, marking the former president’s bold foray into digital assets and merchandise sales ahead of his inauguration.
The announcement, which was made on Truth Social late Friday, was described as a celebration of Trump’s “WINNING” the presidential election. The coin, built on Solana’s blockchain platform, debuted with a limited supply of 200 million coins. According to its official website, the supply is set to expand to 1 billion over the next three years.
The venture was co-ordinated by CIC Digital LLC – an affiliate of the Trump Organization – which has previously sold Trump-branded shoes and fragrances. CIC Digital LLC and Fight Fight Fight LLC, a company formed in Delaware earlier this month, own 80% of the tokens. It is unclear how much money Trump might make from the venture.
While $TRUMP’s meteoric rise has generated buzz, Nigel Green, CEO of deVere Group, urges caution.
“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,” he explained. “Without doubt, investors will get burned by this frenzy too.”
The deVere CEO highlights the speculative nature of meme coins, warning that their valuations can fluctuate wildly. He explained that while big money can be made by some, this type of investment is inherently high-risk and unpredictable.
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He says: “Let’s be very clear: this is more gambling than investing. If you’re considering getting involved, you need to have a sound, diversified, long-term plan in place first.”
The $TRUMP coin’s rapid ascent underscores the risks associated with meme coins, which are driven less by fundamentals and more by social media-fueled hype. Nigel Green likens the phenomenon to gambling, explaining that many day traders are likely piling in with hopes of capitalizing on the Fear of Missing Out (FOMO).
“They’re mostly not buying because they think the coin has inherent value,” he said. “They’re buying because they hope others will drive the price higher, allowing them to sell at a profit.”
This strategy comes with significant risks, and he emphasizes that valuations for meme coins are likely to swing wildly in both directions. He adds: “Understand the real risks to your money. This is not the same as investing in sound assets. Gambling is not the same as investing.”
“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,” he concludes.
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