If it weren't for the help of three cryptocurrency institutions, the performance of the $TRUMP listing on its first day might have been very different.
Author: Logan Hitchcock
Source: decrypt
Translated by: Ada, MetaEra
MoonPay is a cryptocurrency payment company that successfully obtained a total of $160 million in loans from Galaxy Digital and Ripple to cope with the explosive demand for the Trump official Solana chain Meme Token TRUMP over the launch weekend.
MoonPay President Keith Grossman detailed the collaboration in the "When Shift Happens" podcast. In this collaboration, MoonPay CEO Ivan Soto-Wright made a major commitment, and the company also had to "guarantee" that there were no liens on its reserve funds.
Grossman said: "The trading volume was extremely huge. Our cryptocurrency liquidity was locked in BlackRock's accounts through traditional financial means... and that was a Saturday."
Under the guidance of the Trump Meme Token team, users flocked to use the mobile Meme Token trading app Moonshot to trade, and MoonPay, as the sole cryptocurrency payment provider for Moonshot, saw its existing cryptocurrency funds being consumed at a staggering pace.
The emergence of Moonshot is a breath of fresh air in the field of cryptocurrency trading. It simplifies the process of buying Meme Tokens to the extreme, where users can easily complete registration with just an email, and then conveniently top up their accounts using credit or debit cards. For newcomers to the cryptocurrency world, trading on decentralized exchanges often involves complex technical challenges and operational thresholds, but Moonshot perfectly avoids these obstacles, becoming the primary choice for newcomers to enter the Meme Token trading arena.
As new users, filled with investment enthusiasm for TRUMP, prepare to showcase their skills on the Moonshot app, the process of fund flow is quietly activated. They first use their fiat currency to exchange for the cryptocurrency reserves of MoonPay, with the stablecoin USDC being the main exchange target. Subsequently, these USDC are used to purchase TRUMP Tokens on the Solana blockchain.
However, the liquidity of the cryptocurrency market is a double-edged sword, playing a crucial role in the smooth progress of transactions. If MoonPay is unable to maintain sufficient liquidity to continuously support the purchase of TRUMP tokens, the investment path of new users will face major obstacles. It is worth noting that in the week of the TRUMP launch, MoonPay successfully attracted up to 750,000 new users to register. If such a large user base is unable to smoothly purchase the desired TRUMP tokens, it will not only seriously hinder the rapid development momentum of the token in the initial issuance period, but may also trigger a chain reaction, causing significant negative impacts on MoonPay's other user groups, and ultimately affecting the entire cryptocurrency trading ecosystem based on the Moonshot platform.
Grossman said that if MoonPay's funds are depleted, the app may prompt users with "Sorry, unable to complete the transaction".
To avoid this situation, he, along with MoonPay CEO Ivan Soto-Wright and CFO Mouna Siala, predicted the amount of funds needed. Initially, they estimated $50 million was required, but after re-evaluating the rapid growth of TRUMP Token in the first 24 hours of its launch, this figure quickly doubled to $100 million.
However, since MoonPay's reserve funds were locked in the traditional financial system and could not be used immediately, Grossman decided to contact Mike Novogratz of Galaxy Digital. After a simple conversation, the two parties quickly reached a loan agreement. MoonPay's team had to urgently process the relevant documents, while also confirming through their relationship with BlackRock that the company had the ability to repay the loan.
But even so, $100 million was still not enough. As the demand for TRUMP Token continued to soar the next day, MoonPay sought help from Ripple Labs CEO Brad Garlinghouse.
The MoonPay team told Garlinghouse: "We underestimated the demand for Trump tokens."
Ripple's CEO agreed to provide additional financial support, but on the condition that MoonPay must obtain Galaxy's consent to ensure that the previous loan arrangement was not affected. Ultimately, Ripple provided an additional $60 million loan to Galaxy, which was then transferred to MoonPay.
As traditional financial institutions in Europe and the United States resumed operations on Monday and Tuesday, MoonPay regained access to its funds and fully repaid the loan on Tuesday afternoon.
According to CoinGecko data, the average trading volume of the TRUMP Token exceeded $20 billion in the first five days after its launch, and reached a fully diluted valuation (the theoretical total market cap if all tokens were unlocked) of over $73 billion in less than 48 hours.
Shortly after the TRUMP issuance, it was successfully listed on well-known centralized exchanges such as Binance and Coinbase, allowing inexperienced new investors to participate in the trading more easily.
A representative of MoonPay confirmed to Decrypt that Grossman's statements were accurate. However, representatives of Galaxy and Ripple did not respond to Decrypt's requests for comment.
Currently, the trading price of TRUMP is $15.37, a drop of over 79% from its all-time high, demonstrating the uncertainty and investment risks in the cryptocurrency market.
