Within hours of its launch on Friday, January 17, the price of Trump’s oh-inventively named meme coin $Trump had skyrocketed 600% and reached a notional total market capitalization of $32 billion ($50 billion). dollars).
As of Saturday, its market value was US$12 billion, while the First Lady’s meme coin (called, you guessed it, $Melania) was valued more conservatively at $1.7 billion.
According to the coin’s official website, an affiliate of the Trump Organization owns 80% of the coin. By the following Monday morning, the president’s share of the $Trump coin was worth tens of billions of dollars.
To put it in more terms, over just three days, Trump’s personal wealth increased up to 89%making him among the 25 richest people in the world (on paper, at least).
Putting aside the glaring ethical questions of a world leader so blatantly monetizing their elections, there are a few other issues at play.
For starters, when the coin was first released, its legitimacy was questioned to the point that Trump himself had to come out and publicly confirm its authenticity on social media, which is never a great sign in when it comes to investing your hard-earned money.
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Another issue concerns the coin’s fine print, which informs potential buyers that its sole purpose is to “function as an expression of support and engagement with the ideals and beliefs embodied by the $Trump symbol and associated artwork.” , and are not intended to be or to be the subject of an investment opportunity, investment contract or security of any type.”
Of course, no one has to buy cryptocurrency or meme coins specifically. So why does it matter that some people choose to buy Trump’s coin and make some quick money? With great risk comes great reward, right? Well, apparently not.
One of the biggest myths about cryptocurrency is that it allows the average Joe or Joanna to make more money, and often faster than they would if they were investing in, say, the market stock market.
The overarching mentality, especially when it comes to coins, is that with great risk comes great reward, and without Wall Street’s involvement, anyone can become a millionaire overnight.
Although the fine print has stipulated that the coins are not an investment, it’s hard to see how something that increases in value the more people hand over the capital can be called anything else.
And so, for all the optimism, $Trump and $Melania’s results are the perfect example of why investment in cryptocurrency remains so high.
According to Solanaabout half of the people who used the platform to buy Trump$coins were first-time buyers of Altcoins (cryptocurrencies excluding Bitcoin). The same number of people created a wallet (which allows buying and selling of coins) on the same day they purchased the coins from the first family, meaning their sole intention of being on the platform was to purchase these specific parts to instruct the person with an 80% stake in his success.
Of the wallets that held $Trump and/or $Melania coins, 80% had less than US$1,000 in assets. So on the one hand, you might think that at least they’re investing small, right? But when you consider that one in four Americans has less than US$1,000 in savings, it’s suddenly no longer a low-risk punt just for fun.
Additionally, an estimated 77% of coin buyers made a profit of less than $100, while others only broke. However, Trump is not the only person doing well. According to Axios60 investors pocketed more than $10 million.
The rich are getting richer while everyone else barely sees a dent? This looks like a rich rick pattern to me.
Victoria Devine is an award-winning retired financial advisor, best-selling author and host of Australia’s #1 financial podcast, She’s on the money. She is also the founder and co-director of Zella Money.
- The advice given in this article is general in nature and is not intended to influence readers’ decisions regarding investment or financial products. They should always seek their own professional advice which takes into account their own personal circumstances before making financial decisions.
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