A new cryptocurrency named Investing.com OFFICIAL TRUMP Index was introduced by a Trump-associated entity known as CIC Digital. The launch of this meme coin has garnered significant attention, achieving a fully diluted market cap of approximately $73 billion and trading volumes surpassing $30 billion within a day. This rapid success has allowed the TRUMP coin to eclipse the market cap of the previously dominant meme coin, DOGE, which stands at around $54 billion.
The introduction of TRUMP has sparked a variety of reactions within the crypto industry. Proponents argue that the involvement of a major political figure like the President-elect signals a reduction in regulatory risks for token launches in the United States, suggesting a resurgence of freedom and innovation for U.S. crypto developers.
On the other hand, critics point to the fact that 80% of the TRUMP token supply is controlled by wallets linked to CIC Digital, raising concerns about potential market manipulation and the risk of losses for uninformed investors.
Bernstein analysts explain that the Trump family's exploration into cryptocurrency follows their reported experiences with de-banking after the 2020 election loss. The Trump campaign has previously leveraged crypto technology to fundraise, selling branded NFTs, mugs, and sneakers.
The success of animal-themed meme coins, such as DOGE and a PEPE frog-themed token, indicates the potential for a politically branded coin to attract significant investment and new traders, evidenced by more than 400,000 new holders on the meme token buying platform moonshot.
Analysts suggest that the launch of the TRUMP token marks a paradigm shift for the crypto industry, potentially heralding a new era of regulatory perspectives where governments may view cryptocurrency as a direct means to engage with the populace. This could lead to more crypto-friendly policies from certain politicians in the U.S. and other countries.
In the days ahead, the market's attention is likely to focus on how the Trump affiliate insiders will utilize the substantial 80% TRUMP token supply they hold. Possibilities include using the tokens as collateral for crypto banking and finance projects, creating engagement models to reward supporters, or funding further political initiatives. The manner in which the Trump team manages this supply will be crucial to the token's value stability.
The launch of the TRUMP token on the Solana blockchain has also had a notable impact, with Solana experiencing over $50 billion in trading volume in the last 48 hours and its token value increasing by roughly 20%. This trading surge has tested the blockchain's capacity, a challenge that Solana aims to meet by scaling to levels comparable with NASDAQ.
"Whichever way you see it, we think a new chaotic crypto era is here. The President of America has his own coin. Our view would be to view the event as a signal that a new crypto regulatory era is here to stay and invest in the more valuable parts of the ecosystem. But some may still cringe - it is what it is," analysts wrote in a note.