Donald Trump's Meme Cryptocurrency, TrumpCoin, Has Created Dramatic Wealth Disparity

A recent investigation by CNBC's MacKenzie Sigalos has revealed that Donald Trump's meme cryptocurrency, dubbed $TRUMP or TrumpCoin, has

"As Donald Trump's 2024 presidential campaign unfolded and the former president unexpectedly embraced cryptocurrency, a new meme token hit the market: $TRUMP or TrumpCoin. A recent investigation by CNBC's MacKenzie Sigalos has revealed the dramatic wealth disparity among investors in the token. Just 58 crypto wallets reportedly made millions from the token, while a staggering 764,000 wallets are currently sitting at a loss.

The meme coin, which Trump himself has not formally endorsed, sparked interest following Trump's pivot toward accepting Bitcoin and Ethereum donations for his campaign. This move signaled to his base and the broader crypto market, especially during a bear market, to begin buying the token. However, this rapid price surge followed a familiar pattern in the crypto world. Early adopters, such as those who acquired the token for less than $0.0002, reaped significant profits. In contrast, latecomers entered the market at higher prices as the token's mainstream exposure peaked, only to watch their investments plummet.

According to blockchain data, the wallets that profited the most were either involved in the earliest trades or received large token allocations (greater than 1 billion) before the token's significant exposure on major news outlets and social media. For instance, one crypto wallet acquired 500 million TrumpCoins for less than $0.0001, later selling at a price above $0.01, ultimately amassing a profit exceeding $49 million. Another wallet, receiving a large allocation, began trading the token at $0.0001, later selling at $0.003, resulting in a profit exceeding $297 million.

In contrast, the majority of retail investors who entered during peak hype, induced by news articles and social media posts about TrumpCoin, encountered increased buying pressure that drove the token's price to highs of $0.03. However, as the hype subsided and news coverage decreased, the token's price experienced a decline of over 90% from its peak.

This dynamic, Invictus Capital founder and CEO Matias Bäcker, in an interview with Blockware Solutions, described as a "winner-takes-all structure," might be familiar to those who followed the recent frenzy surrounding the meme coin, Balenciaga, or the video game Among Us. Bäcker further noted that most users "are going to be left in the dust with a small gain or a big loss," highlighting the asymmetrical risk involved.

The spread of meme coins like TrumpCoin is also closely tied to the digital advertising landscape. Companies such as NBCUniversal, which operates several major news networks, track user behavior using cookies and other tools to deliver personalized content and ads. This includes interest-based advertising, where individuals who frequently engage with crypto news or have shown interest in blockchain technology through their browsing patterns may be more likely to encounter promotions for TrumpCoin or other tokens.

While these tracking tools—such as measurement, analytics, and ad delivery cookies—are standard across the internet, they also contribute to the viral nature of speculative tokens. Investors may encounter frequent crypto promotions tailored specifically to their online habits, making falling into high-risk investment traps easier, especially during periods of market hype.

The situation with TrumpCoin also raises concerns about how tokens can gain traction through implication rather than verification. As Trump's campaign accepted crypto donations via email, some reports stated that the campaign was not directly involved in promoting TrumpCoin, despite the token's name and the possibility of donors being encouraged to invest in a token related to the campaign.

This entanglement of political figures with crypto markets, whether directly or indirectly, underscores the urgent need for stronger regulatory frameworks. With election season ramping up and digital platforms delivering hyper-targeted political and financial content, investors must tread carefully. The lure of fast profits continues to attract newcomers, but as TrumpCoin illustrates, the cost of speculation often lands hardest on the many, not the few.

The story of TrumpCoin serves as a stark reminder of the potential risks and rewards in the world of cryptocurrency, especially during periods of heightened political activity and meme coin mania. As the lines between news and advertising blur, and the dust settles on another chapter in the saga of meme coins, the tale of TrumpCoin stands as a cautionary tale for investors of all levels of experience.

The investigation by CNBC also touched upon the role of social media in promoting TrumpCoin. According to the report, several social media accounts, some with a large following, actively promoted the token, especially during its early stages. These accounts, which allegedly belonged to Trump supporters or cryptocurrency enthusiasts, shared links to articles about the token, discussed its price movements, and encouraged their followers to invest.

However, as the token's price began to rise rapidly, some of these accounts reportedly stopped promoting TrumpCoin and started focusing on other tokens or crypto-related content. This shift in attention may have been due to changes in their own investment strategy or a desire