In this sense, Jacob Silverman, co-author of the Easy Money: Cryptocurrency, Casino Capitalism, and the Golden Age of FraudThe TRUMP coin setup seems to have some of the hallmarks of a “classic memecoin pump-and-dump” – a maneuver where an issuer holds a large amount of their coins, promotes the project, then cashes in their coins. property, devaluing the coin and facing huge losses to other investors. will be some kind of major sale is huge. It’s a huge red flag,” Silverman said. “Unfortunately, some bad juices will dissolve.” (The pump-and-dump occupies an object of a legal gray arealegal experts said, but was thoroughly condemned as ethically dubious.)

Melania Trump’s decision to release her own memecoin appears to have already dealt a blow to TRUMP investors, even without any alleged potential pump-and-dump. After the MELANIA coin went live, the TRUMP token fell in price by 50 percent.

The litany of unofficial Trump-inspired memecoins is among them swelling, YOURSELF Six, Doland Tremp and Super Trump—the value also dropped. During the 2024 election cycle, political memecoins are used as a proxy for betting on election results and expressions of support for a particular candidate, the rise and fall of events on the campaign trail. But the TRUMP launch inadvertently hurt inventors who bought unofficial coins as a sign of their support for Trump.

“I don’t think it’s appropriate for the president of the United States,” said Steven Steele, director of marketing for the MAGA token, in a video posted by X. “This seems like a serious cash grab.”

Perhaps more dangerous than the financial loss brought by supporters, the Trump memecoin could also act as a new vector for bribery, claims Silverman. By investing large sums in a cryptocurrency in which Trump has a large financial interest, thereby increasing its price, politically motivated actors can gain favor with the president without any kind of direct transaction. that happened, he said. “These are the kinds of channels for influence and leverage of a kind that we’ve never seen before,” Silverman said.

The release of an official Trump memecoin marks the latest development in the president’s ongoing flirtation with crypto. Even in his first term Trump dismissed bitcoin as “scam“he is doing a complete volte-face in the run-up to the 2024 presidential election. As figureheads in the crypto industry endorsed his presidency and throwing hundreds of millions of dollars in donations of pro-crypto super political action committees, Trump began positioning himself as “president of crypto.”

In July, spoke to thousands of bitcoiners at a conference in Nashville, Tennessee, Trump promised to make the US the “crypto capital of the planet” and establish a national “stockpile of bitcoins” if re-elected. Later in September, the Trump family helped launch a new crypto business, World Liberty Financial, which they created as a way to “make finance great again.” (It remains unclear what services World Liberty Financial will provide.)

World Liberty Financial was then met with skepticism by some members of the crypto industry, who are concerned that the project could lead to losses for investors and face lasting reputational damage if it fails. The same logic applies to the TRUMP memecoin. “If it completely blows up in a lot of people’s faces, it’s even worse, because the media attention will be negative,” Bendiksen said.

But for all the potential consequences, there’s little stopping Trump from testing the boundaries of what’s acceptable in crypto, Silverman said, as others have done before him. Specifically him preparing to overhaul the SECthe financial regulator that most actively pursued in the crypto industry under the previous administration.

“In some ways, he’s just a crypto trader,” Silverman said. “He’s the only president.”