President Donald Trump’s reputation within the cryptocurrency sector seems to have suffered after he and his wife introduced their own meme coins. Critics have labeled this action as a somewhat distasteful grab for cash, one that contradicts efforts to bring legitimacy to digital currencies.
The cryptocurrency world, which has often felt unjustly targeted by the Biden administration and invested significantly in Trump’s campaign, is seeking support from the new president to help integrate crypto further into mainstream financial frameworks. Trump has committed to a more lenient regulatory approach and has appointed officials with favorable views toward cryptocurrencies to significant government roles.
Following Trump’s electoral victory, the values of Bitcoin and other cryptocurrencies have surged. A lavish “Crypto Ball” was held the Friday before his inauguration, selling tickets for thousands of dollars, with performances led by the rapper Snoop Dogg.
However, during this celebratory event, Trump took to social media to announce the launch of his own cryptocurrency, depicted as a meme coin. This declaration soured the mood for many within the crypto community. Tom Schmidt, a partner at the venture capital firm Dragonfly, expressed his disappointment, stating, “It just felt very grifty and cheap.”
Some members of the cryptocurrency community even humorously commented on social media that they regretted the departure of Gary Gensler, the former chairman of the Securities and Exchange Commission, who was often viewed as a key adversary to crypto initiatives due to the SEC’s rigorous enforcement against various crypto firms.
Meme coins occupy a unique and largely unregulated space in the cryptocurrency landscape. They often originate as jokes, lacking intrinsic value, yet can experience significant price increases if they gain enough public interest. Notable examples of meme coins include Dogecoin and others similar in nature that can be exploited by scammers looking to inflate values before abandoning unsuspecting investors.
Despite the criticisms, some supporters of the Trump meme coin celebrated its release, leading to an initial price surge that exceeded $70. However, the value plummeted on Sunday after First Lady Melania Trump announced her own meme coin, which also saw an early spike before a sharp decline. As of Tuesday afternoon, Trump’s coin was trading around $45, while Melania’s was valued at about $4.
Recently, Trump appointed SEC Commissioner Mark Uyeda as the agency’s acting chief. Uyeda wasted no time in declaring the establishment of a new task force aimed at guiding the SEC toward a more sensible regulatory framework for cryptocurrencies. Trump has vocalized plans to create a U.S. bitcoin reserve and implement favorable regulations that simplify access for crypto companies to larger financial markets.
Nevertheless, Trump’s close association with meme coins has raised concerns among some cryptocurrency advocates regarding how it might impede his capacity to push for necessary reforms. Nic Carter, a Trump supporter and management partner at Castle Island Ventures, noted that at a time when there was potential for some regulatory advancement, the narrative surrounding cryptocurrencies has now shifted to viewing them merely as a gambling hub for meme coins. He expressed that it detracts from the industry’s legitimacy, making it seem frivolous.
The sale of Trump meme coins has been orchestrated by CIC Digital, a subsidiary of the Trump Organization. In his promotional message, Trump encouraged his supporters by stating, “Have Fun!” The website dedicated to these tokens highlights them as means to express support rather than investment vehicles. Currently, 200 million Trump meme coins are available, with ambitions to circulate 1 billion within the coming three years.
Additionally, the Trump family business has recently released an ethics agreement that restricts Trump’s involvement in “day-to-day” operations of the Trump Organization during his presidency while limiting his access to financial data pertaining to the business.
The promotion of new cryptocurrencies wasn’t limited to the Trump family; Lorenzo Sewell, a pastor from Michigan who led the inaugural invocation, also unveiled a coin named after himself, stating that it would be used for the benefit of his church. In a social media video, Sewell urged viewers to purchase the “official Lorenzo Sewell coin.”
