Author: Tong Deng, Jinse Finance
On the afternoon of January 17 at 9:44 pm local time, Trump posted on his social media account announcing the launch of his personal Meme coin TRUMP, and users need to visit the website "gettrumpmemes" to obtain the Meme coin.
As soon as the news was released, the market was flooded with both supportive and opposing voices, and the entire crypto market was boiling. Many investors also took the opportunity to make a fortune. According to CoinGecko data, the TRUMP token once reached a historical high of $72.02 on the evening of January 19 at 8:03 pm.
Trump will be sworn in at 12 pm Eastern Time (1 am Beijing time on January 21) under the auspices of Chief Justice Roberts, and will then deliver his inaugural address. The three richest Americans, Musk, Bezos, and Zuckerberg, will appear together. Two sources said that Trump is preparing to issue a large number of executive orders and directives on his first day in office, possibly exceeding 100, covering issues such as immigration and energy production.
At this clever timing, Trump's issuance of a Meme coin inevitably raises market speculation: Will this move truly benefit the crypto market? Is it a game of chasing money with power?
I. What do industry insiders who support Trump's coin issuance say?
DWF Labs partner Andrei Grachev tweeted: Trump is doing the best marketing for the cryptocurrency market.
Cardano co-founder Charles Hoskinson revealed on X that 78.5% of Trump's $29.6 billion net worth is in cryptocurrencies, making him one of the wealthiest cryptocurrency entrepreneurs. This is mainly due to Trump's Meme coin TRUMP. Hoskinson also pointed out that Trump's extensive involvement in cryptocurrencies may lead to major changes in the industry. His administration may redefine the IRS's policies on capital gains tax and fair market valuation of digital assets, and these expected changes may impact the regulatory framework of the cryptocurrency industry.
Animoca Brands co-founder Yat Siu posted on the X platform: Suggesting that Trump carefully consider using TRUMP to support important charitable foundations and causes, as the handling of the token will have a ripple effect on the trust and reputation of the entire crypto and Web3 industry. Trump has the ability to use TRUMP to do great things, which could make him the most generous and charitable US president in history.
Trump Organization Executive Vice President Eric Trump said on the X platform, "I am very proud of our achievements in the cryptocurrency field, Trump is currently the hottest digital Meme on Earth, and I firmly believe that WLFI will completely transform DeFi/Cefi and become the future of finance. We are just getting started."
II. What do industry insiders who oppose Trump's coin issuance say?
Forbes stated: Trump's issuance of a Meme coin may trigger a constitutional crisis. The report said that although the new SEC chairman-designate may introduce crypto-friendly policies, the underlying legal principles remain unchanged, and the personality and policy preferences of SEC leaders cannot override the established securities laws. The Howey Test, established by the Supreme Court 75 years ago, is the cornerstone of securities regulation and is not affected by the individual government and political appointments. While the SEC's enforcement focus may shift under new leadership, its statutory obligation to apply the Howey Test remains absolute. This enduring framework for evaluating investment schemes is independent of any chairman's crypto-friendly stance or industry relationships. The report pointed out that the launch of the TRUMP Meme coin exposes a fundamental tension in contemporary American politics. While Trump positions himself as a champion of the cryptocurrency industry and promises to make America the "global crypto capital", the structure and timing of his own digital token project raise concerns about the fusion of his personal wealth-building and political power. The concentration of token ownership in companies associated with Trump, coupled with the timing of the issuance just before the inauguration, raises questions: Is this a genuine support for cryptocurrency innovation, or merely a clever attempt to further monetize the presidency?
Arthur Hayes on "Trump issuing Meme TRUMP": This is the launch of the political Meme coin market. Any politician who is not afraid of public opinion will launch their own Meme. The economics of these tokens are fugazi (derogatory term, meaning fake), but these "shitcoins" can reach $10 billion. But he also pointed out: Meme coins are the best fan engagement tool ever. If Trump does this, the risk for Beyonce or Taylor Swift doing it would be much lower.
Former Coinbase executive and crypto venture capitalist Nick Tomaino said that Trump owns 80% of the TRUMP token and launched it just hours before the inauguration, which is predatory, and many people may be harmed. Trump should airdrop it to the public instead of using it to enrich himself or his team. Currently, it looks like an FTX token. But he also pointed out: Trump's move signifies a shift from the Biden anti-crypto era to the Trump era.
Former Coinbase Chief Technology Officer Balaji Srinivasan wrote: Trump's net worth of about $59 billion is now over 90% in crypto assets, a transformation that may have significant implications: 1) Trump's crypto asset allocation has jumped from 1% to 90%, similar to the wealth accumulation path of early Bitcoin and Ethereum holders; 2) This rapid devaluation of non-crypto assets may occur globally in the future; 3) If the TRUMP token value persists, it may trigger a wave of personal token issuance by political and celebrity figures. He suggested that Trump could resolve potential conflicts of interest through an airdrop scheme: Based on the current valuation, airdropping $100 worth of locked TRUMP tokens to his 77 million supporters would only cost $7.7 billion, and even increasing it to $500 per person would still leave over $20 billion. Balaji believes this plan could not only establish a new "president-citizen" relationship, but also provide a public opinion foundation for Trump to promote crypto-friendly policies. He also pointed out: Meme coins are a zero-sum lottery, they do not create wealth. Every buy order is just matched with a sell order. After the initial surge, the price will eventually crash, and the last buyers will lose everything. If you consider the platform's cut, Meme coins are actually negative-sum.
Danielle Brian, Executive Director of the Project on Government Oversight, stated that Meme coins are often unrelated to any underlying business, making them highly speculative for investors but potentially lucrative for founders, "Any steps the Trump Organization claims to be taking to address potential conflicts (especially those involving foreign governments) seem to completely undermine their efforts." Other groups raising concerns include the nonpartisan Campaign Legal Center and the Citizens for Responsibility and Ethics in Washington, the latter of which sued him during his first term for violating the constitutional ban on foreign gifts and emoluments, but without success. Kedric Payne, general counsel of the Campaign Legal Center, said: "The obvious distinction with cryptocurrencies is how quickly you can make a windfall."
CryptoQuant CEO Ki Young Ju posted on X that "social influence will soon be measured by market cap rather than follower count. Trump's coin issuance yesterday marked this shift. Unless someone more powerful than the president gets involved, it's inevitable. As victims emerge, the chaos will impact the law - that's the saddest part." "Trump is unlikely to deliver on his memecoin. He is more likely to use it to increase his net worth and reward loyal supporters and associates."
Anthony Scaramucci, founder of SkyBridge Capital: This is detrimental to the industry and compares it to the level of corruption of former Ugandan President Idi Amin.
Ben Meiselas, co-founder of Meidas Touch: Trump should focus on more pressing matters.
Dave Portnoy, founder of Barstool Sports: This event is similar to the alleged Meme coin HAWK pump-and-dump scheme involving influencer Haliey Welch.
Coffeezilla, a cryptocurrency detective on YouTube: This launch is a "historically stupid move".
Bitcoin bull Anthony Scaramucci warned his one million followers on X not to "delude themselves" about the launch of Trump's official Meme coin.
Bitcoin Magazine, the organizer of the Trump Bitcoin Conference, stated on social media that TRUMP is a shitcoin. Bitcoin Magazine was a well-known pro-Trump media outlet during the elections, and had invited Trump to speak at its official Bitcoin 2024 conference, where Trump announced plans for a Bitcoin strategic reserve, ensuring the US would become a global crypto hub and Bitcoin superpower, and firing the SEC chairman, kicking off the crypto-friendly policies of the Trump administration.
Lawyer David Lesperance pointed out: A president-elect launching a Meme coin would violate the provisions in the US Constitution aimed at preventing foreign influence on US government officials. "In the past, President-elect Trump's launch of his Meme coin, TRUMP, would have been seen as a clear example of violating the Foreign Emoluments Clause of the First Article, Section 9 of the US Constitution." "Given that TRUMP could easily be purchased by foreign individuals or governments, this appears to violate this clause."
III. Will Trump's Meme coin help boost Trump's net worth to the top?
Crypto KOL Conor posted on the X platform that based on the Trump family team's holdings, the target prices for TRUMP to surpass various Forbes billionaires are: $118 to surpass Michael Bloomberg; $145 to surpass Bill Gates; $203 to surpass Mark Zuckerberg; $225 to surpass Elon Musk; $270 to become the world's richest person.
On January 19, "Trump Launches Virtual Currency, Surges 1250% Intraday" topped Baidu's hot search list at #13, and "Trump's Net Worth Soars 400% Overnight" topped Weibo's hot search at #40. The related search on Weibo was "Cryptocurrency President Trump's estimated net worth has soared to $28 billion overnight, thanks to the virtual currency 'TRUMP' he issued, increasing his estimated net worth by 400%."
Within just 24 hours of Trump's launch, its market cap soared to a staggering $4.8 billion, with a fully diluted valuation of $24.3 billion. This not only set a new record for Meme coins, but also portends its potential to challenge Dogecoin's dominance in the Meme coin realm. To many, the president's launch of a Meme coin is unprecedented, but upon closer examination of Trump's long-standing practice of leveraging his personal brand for monetization, from Trump University to Trump Hotels & Casinos, and even NFTs, this should come as no surprise. The difference this time lies not in the strategy, but the medium - an ironic fact stemming from the current regulatory environment.
IV. Is Melania Trump's Meme coin MELANIA reliable?
Melania Trump, the former First Lady, announced on social media in the early hours that people can now buy the Meme coin MELANIA. However, according to Unusual Whales, the official website and domain of Melania Trump's Meme coin MELANIA were created just yesterday.
Ryan Selkis, a staunch Trump supporter and founder of Messari, publicly called on Trump on social media to fire the individuals responsible for launching the Melania project today. Selkis pointed out the following issues with the project: the project team lacks professional competence; it may cause significant economic losses and reputational damage; the project decisions did not adequately consider Trump's interests.
According to the Melaniameme website, the MELANIA token has a significantly different token economic model compared to TRUMP. The token allocation is: 35% for the team, 20% for the treasury, 20% for the community, 15% for public offering, and 10% for liquidity. In terms of the unlock mechanism, the MELANIA team's share only requires a 30-day lock-up, while TRUMP requires a 3-year lock-up. The MELANIA team's share will first unlock 10% (3% of the total supply) on the 30th day, and then linearly unlock the remaining portion over the next 2-13 months, at a rate of approximately 2.25% of the total supply per month, until fully unlocked by the 13th month.
According to on-chain analyst Yuyan's monitoring, the Meme coin MELANIA launched by Trump's wife reached a fully diluted valuation of $10 billion in just 5 hours, but there appears to be an error in the team's unlock portion of the MELANIA token allocation on the official website. The website states that the total supply is 1 billion MELANIA tokens, with 35% allocated to the team, but the unlock rules are only provided for 30% of the team's allocation. This may mean that up to 65% of MELANIA could be in circulation. "The MELANIA team portion will start unlocking after one month and be fully unlocked within 13 months," but according to the allocation breakdown on the website, the team is allocated 35%. And based on the team unlock rules below, it's calculated as 30%. So there seems to be some discrepancy in the actual team allocation.
According to on-chain analyst @ai_9684xtpa's monitoring, regarding the liquidity of the MELANIA token, as of now, the DEV address has added 129 million tokens as single-sided liquidity to the MeteoraMELANIA/USDC pool, and the token economics indicate that 10% of the tokens (i.e., 100 million) will be used for LP; the pool currently has 9.64 million MELANIA and 275 million USDC, with a TVL of $393 million. Regarding the token distribution, the DEV address has distributed 870 million tokens to five addresses, three of which have not taken any action yet, while the addresses 7Wk1V...xdMkA and 3XKsc...t6uKu are also executing the action of adding liquidity.
Five, Trump Family Project Attracts Attention, WFLI Sold Out and Will Restart Sales
On January 20, according to the official website, the pre-sale of the official token of the Trump family crypto project World Liberty Financial (WLFI) has been sold out. But after the sell-out, the Trump crypto project WLFI stated on social media that they have completed the mission and sold 20% of the token supply, and due to the huge demand and high attention, they have decided to reopen 5% of the token supply. The team is working hard to restart the sales.
As expected, WLFI restarted the sales in just two hours.
According to on-chain analyst @ai_9684xtpa's monitoring, with the sell-out of WFLI, the on-chain holdings of World Liberty Financial (WLFI) have soared to $235 million, and the top 3 holding assets are all subscription assets: ETH: $109 million; USDT: $63.23 million; USDC: $55.16 million; the ETH holding has increased to 33,631, and it should be noted that most of them are from the WFLI public offering, with only 12,601 being actively purchased; the institution has cumulatively purchased 24,433 ETH (at a cost of $3,379) and has deposited 11,832 ETH into Coinbase, the purpose of which is unclear.
The Trump family project WLFI has spent $48 million USDT to buy 14,403 ETH in the past 11 hours. Trump's younger son Eric Trump retweeted a tweet about World Liberty (WLFI)'s large-scale ETH purchase and said: "Let's see what they do tomorrow."
In addition, World Liberty also has a strong interest in ENS domain names: the World Liberty multi-signature address bought the domain name 9290.eth around 12:00 today; 10 hours ago, they bought the domains WorldLiberty.eth, trumpcoin.eth, erictrump.eth, and barrontrump.eth.
As of the time of writing, according to CoinGecko data, TRUMP has risen 47.3% today, currently trading at $45.39.
MELANIA has risen 8.0% today, currently trading at $8.02.
