Trump's Crypto Advocacy Boosts Family Net Worth by 40%

U.S. President Donald Trump has significantly shifted his stance on cryptocurrency since 2019, when he described its value as "based on thin air." Today, he is one of the sector’s most prominent advocates, engaging in various crypto activities including memecoins, DeFi, NFTs, and stablecoins. A recent report by the State Democracy Defenders Fund estimates that Trump’s family has increased their net worth by $2.9 billion through crypto investments, with 40% of that net worth now held in crypto assets.

Trump's growing involvement in the crypto industry has had a notable impact on the political landscape. A bipartisan stablecoin bill failed in a key vote after Democrats expressed concerns about the extent to which Trump is profiting from the sector. His support for crypto has contributed to a continued bull market, characterized by two main trends: the rise of memecoins and the institutional adoption of bitcoin via ETFs. While the latter is primarily driven by institutional investors, the memecoin market poses risks for retail investors and is susceptible to exploitation.

On Thursday, Solidus Labs claimed that 98% of memecoins issued on the token creation platform pump.fun were rug pulls or pump-and-dump schemes. The platform has since refuted these claims. Another analysis suggested that the vast majority of TRUMP token holders lost money. A memecoin is a type of crypto token with no inherent value, often based on a meme or cartoon character. Examples include dogecoin (DOGE), shiba inu (SHIB), and pepe (PEPE). The craze reached its peak in January when Trump promoted his own TRUMP token on social media, followed by MELANIA, named after his wife.

TRUMP, which hit a day-one peak of $77.26, is now trading at $10.80, down 86%. MELANIA slumped even further, losing more than 97% of its value in four months to trade recently at 33 cents. The hype around Trump’s social media post led to a flurry of trading activity. Data reveals that 760,000 wallets, mainly belonging to retail investors, lost money on the TRUMP token. However, a small group of people was immune to those losses. The data show 58 wallets made profits in excess of $10 million. The token’s creators netted a whopping $320 million in trading fees, although it’s worth noting that around 5% of the fees went to the decentralized exchange Meteora, which hosted the launch.

MELANIA was allegedly scooped up by a group of insiders before it was advertised on social media in a technique known as “sniping.” This group of insiders made $100 million on MELANIA tokens by swapping tokens for USDC after its price doubled, according to an investigation. One insider with access to the tokens before they went live was Kelsier Ventures’ Hayden Davis, who revealed his involvement during an interview in February. Davis was also behind the botched LIBRA stablecoin that brought political chaos to Argentina. In an interview, Davis said: “This is going to put me in a lot of danger. Which is fine, I’ll answer. I was a part of it [MELANIA]. I think the team did want to snipe it because of how big the snipe was on TRUMP. We definitely weren’t the big sniper, that was what we were trying to avoid. We didn’t take any liquidity out, zero.”

Trump’s involvement in crypto extends beyond memecoins. The U.S. president’s family is also behind World Liberty Financial, a decentralized finance (DeFi) platform that raised around $590 million across two pre-sale rounds earlier this year. It raised funds at a time when the market was resting around all-time highs, so that figure of raised crypto is now much less. Data suggests that World Liberty Financial holds around $103 million worth of crypto. Trump also attempted to capitalize on the NFT hype in 2022, releasing a series of cartoons depicting the president as a superhero or a cartoon character. Trump made around $8 million from rolling out these NFTs, according to financial disclosures.

Most recently, there was the crypto dinner event, which saw Trump host a group of 25 TRUMP holders to a private dinner and tour of his Virginia golf club. A report reveals that 19 of those 25 holders were either foreign entities or used an offshore exchange banned in the U.S. He is set to host another dinner for the top 220 holders of his token later in May. Senators called for Trump’s impeachment, asking the U.S. Office of Government Ethics to investigate whether Trump violated federal ethics rules by inviting top investors. The Trump family did not immediately respond to a request for comment.