Trump Accused of ‘Pump and Dump Scheme’ With the Launch of $TRUMP and $MELANIA Coins
The cryptocurrency world was surprised over the weekend by the contentious launches of Donald and Melania Trump-backed meme coins. These newly launched coins accumulated a combined market worth of more than $16 billion in no time. However, the peculiar surge following market instability has sparked widespread criticism, with allegations of financial greed and ‘pump-and-dump’ practices ruining Trump’s reputation.
On Jan. 18, the self-branded ‘Official Trump’ ($TRUMP) token debuted and reached an incredible $15 billion market valuation in hours. Just a day later, Melania Trump launched her meme coin, $MELANIA, which peaked at $13 billion before losing over half its value.
Critics believe that the back-to-back releases appeared to put personal financial gain over moral concerns, describing the actions as exploitative.
The rapid rise and fall of the tokens has prompted financial analysts to question the reasons behind these launches. Jim Bianco, president of Bianco Research, said that Trump’s decision to release $MELANIA shortly after $TRUMP’s success was motivated by avarice.
“He tried to double down with a $MELANIA, but the market thinks it is a form of dilution and assumes/fears that Trump has tons of other coins in the wings to come.”
The immediate impact made $TRUMP’s value fall 38% after $MELANIA’s introduction, wiping out billions of dollars in market capitalization.
Critics Call $MELANIA ‘Unforced Error Before the Presidential Inauguration’
The launch time of these meme coins has raised concerns with analysts pointing to the financial chaos and Donald Trump’s inaugural preparations. Edward Dowd, the creator of Phinance Technologies, called the scenario the largest unforced error ever made before a Presidential inauguration. Others like financial expert Michael A. Gayed, were more direct, accusing the tokens of being textbook ‘pump-and-dump’ operations.
Gayed said on X that Trump’s credibility has been “totally destroyed,” describing TRUMP as a “pump and dump” scheme.
Delphi Labs co-founder José Maria Macedo suggested that the insiders behind the $TRUMP token were taken aback by its rapid popularity: “My read is that the insiders who helped launch $TRUMP didn’t realize how much it would pump and either didn’t buy enough or sold too early”.
Macedon further highlighted the huge losses caused by the tokens’ volatile performance and estimated $30 billion in total value destruction.
Ryan Selkis, Messari’s former CEO and a Trump supporter called for quick action, advising Trump to remove those who launched $MELANIA. Selkis argued that the team behind the token lacked the expertise to safeguard Trump’s interests, exacerbating the image of poor management.
Also read: Crypto ETF Filings Surge as Gensler’s SEC Tenure Nears End
Crypto Market Turmoil Adds to the Chaos
The meme coin debacle occurred during a cryptocurrency market bloodbath. Bitcoin fell 6% over the weekend, from $105,900 to less than $99,650. Despite the response, the combined market capitalization of $TRUMP and $MELANIA is still impressive at more than $16 billion. However, the incident has cast suspicion on the family’s cryptocurrency projects, raising concerns about the ethical limitations of using political power for financial gains.
Even though meme coins have caught traders’ interest, any potential financial advantage could be overshadowed by negative perceptions and fraud claims. With political credibility and public trust at stake, the stakes are higher than ever for a well-known figure like Donald Trump.
Also read: Trump and Dump? TRUMP Coin Soars After Binance and Coinbase Listings
With experts warning about potential legal repercussions and opponents questioning the family’s intention, the story of $TRUMP and $MELANIA is an important reminder about the combustible junction of politics, cryptocurrency, and greed.
