What Trump’s token means for the cryptocurrency market

Bernstein experts believe that the appearance of a meme token from the world’s most important politician indicates a major change in the approach of the US and other countries to the crypto industry. First of all, the TRUMP token generated trades worth billions of dollars in the first few hours of its existence.

US President Donald Trump at a Pubkey bar

In addition, it sucked liquidity out of the coin market, as investors actively got rid of their savings and invested capital in the novelty from Donald Trump. However, that’s not all.

Analysts note that the FDV or fully diluted value of the TRUMP meme token allowed the asset to outperform the largest meme called Dogecoin.


Recall, FDV means the product of the current rate of the asset by its maximum supply. The total supply of TRUMP will be one billion tokens, but 200 million coins were in circulation when the project was launched. The remaining 800 million will end up in circulation over the coming few years as unlocked assets for the Trump team.

That is, the current diluted value of $TRUMP is five times its current market capitalisation. And although this figure combines the current rate of the asset with its future circulation, it is still popular among traders.


Buying cryptocurrencies by investors

Here’s a rejoinder from Bernstein analysts led by Gautam Chhugani, as quoted by The Block.

This marks the beginning of a new era of regulation, with governments beginning to see cryptocurrency as a technology that can directly interact with the masses. Such a thing could lead some politicians to support more favourable policies for crypto – we’ve already seen examples of this in the US, Argentina and even Canada, where right-wing political forces have expressed support for BTC and digital assets.

The representatives of the company are sure that what is happening can be considered as a signal to activate developers and investors. However, given the impending change in the leadership of the Securities Commission, they will hardly have to worry about the threat from the financial regulator.

Recall that many blockchain companies have received lawsuits from the SEC under the leadership of Gary Gensler. With him, the regulator clearly opposed the coins and even called them by the non-existent in the legislation phrase “cryptocurrency securities”. Analysts continue.

Given that the previous regulatory regime in the US was aimed at tightening controls on crypto project developers and enforcing token regulations, the token launch by the President himself becomes a powerful social signal for developers in the US. In other words, launch projects boldly and don’t be afraid to create tokens – the new era of crypto regulation is here.

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What’s going on with Trump’s meme token

However, not everyone appreciated the fact of the launch of this asset from Donald Trump. For example, Bloomberg analyst Eric Balchunas said that he does not like the new trend. Here’s what he said.

I understand that this is probably being done to fuel enthusiasm around the advent of a new era, but something like this looks like exploitation. In my opinion, it’s an avoidable mistake.

US President Donald Trump

According to Bernstein, such a move by Trump was logical. In addition, the politician’s presidential campaign had earlier started accepting digital assets, making it the first among competitors.

Cryptotechnology allows politicians to directly reach out to audiences to crowdfund their election campaigns and gain support. And with little-known memcoins with animal-themed names reaching capitalisations in the billions of dollars, it’s not surprising that Trump’s social capital-based token could also reach billions and attract a slew of new traders. In particular, a meme token buying platform called Moonshot had 400,000 units of Trump token holders.

The company’s experts recognise that meme tokens often die as the exchange rate collapses for a long time and interest in them declines. However, this does not guarantee a similar fate for Trump’s asset.

Still, the developers of the project can easily add utility to the product in the coming days. For example, it could be the possibility of using TRUMP as collateral on various cryptocurrency platforms, as well as a reward model for fans of this token.

Here’s a final line on the matter.

Any way you look at it, the new chaotic era of cryptocurrencies has arrived after all. America’s president now has his own token. We see this as a signal that a new era of crypto regulation is coming, and seriously and for a long time. The advice is to focus on the more valuable parts of the ecosystem. Of course, some may feel cringe about what is happening – but there is nothing to be done here.


The experts' opinion is that the appearance of the TRUMP meme token does hint at the introduction of adequate regulation for the industry in the near future. Plus, the launch of celebrity tokens could become the new norm. And that too will have a good impact on the overall reputation of cryptocurrencies.


Look for more interesting stuff in our crypto chat. We look forward to seeing you there!

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