Trump's meme coin rakes in $100 Million in trading fees as small traders lose money
Entities behind President Donald Trump’s crypto coin have accumulated close to $100 million in trading fees in less than two weeks, according to estimates from three blockchain analysis firms, a large windfall from a venture that has seen tens of thousands of small traders lose money.
The meme coin, known as $Trump, was launched by the president on Jan. 17 and quickly surged, reaching a peak of over $14.5 billion in overall market value by Jan. 19, the day before his inauguration. It has since slumped by two-thirds, News.Az reports, citing Reuters.
Three crypto data firms, including Merkle Science and Chainalysis, analyzed the blockchain, a publicly available ledger that shows all transactions involving $Trump, for Reuters. They estimated that the $Trump token had generated between $86 million and $100 million in trading fees by Jan. 30.
The estimates far exceed what has been previously reported.
One of the entities behind the crypto coin is a company owned by Trump, called CIC Digital. The official website for $Trump says CIC Digital will “receive trading revenue derived from trading activities” of the meme coin. Reuters could not determine what portion of the fees so far, if any, had accrued to Trump personally, nor the ownership of the other entities behind the coin.
The creators of the meme coin receive a share of the trading fees from Meteora, a little-known crypto exchange where the $Trump coins were first sold, the blockchain analyses showed.
At least fifty of the largest investors in the coin have made profits in excess of $10 million each on the $Trump coin, according to Chainalysis. At the same time, some 200,000 crypto wallets, most with small holdings, lost money on $Trump on the exchange, it said.
Trump has pledged to put his assets in a trust managed by his children on entering the White House. His son, Eric Trump, speaking on behalf of the Trump Organization, told Reuters in response to questions about the fees that he is proud of what “we continue to accomplish in crypto. $Trump is currently the hottest digital meme on earth.”
“We are just getting started,” he added.
The White House responded to a list of questions from Reuters with a two-page fact sheet describing Trump’s executive order earlier this month on digital financial technology. It did not address questions about the trading fees.
Trump has promised to become the first “crypto president” and make America the “crypto capital of the planet” by overhauling regulations and promoting ownership of digital assets. Several key figures in his administration, cabinet and circles hold crypto or have ties to the crypto industry.
But the combination of large dollar amounts around his crypto ventures and their opaque nature has also sparked criticism from ethics experts and Trump’s political opponents in the Democratic party.
"There's an ethical concern that in effect he has the power to regulate his own business," said Richard Briffault, a law professor at Columbia University.
Reuters was unable to determine how much of Trump’s own wealth comes from this newest crypto business because precise details of his ownership are not public. Trump’s other crypto investments include two decentralized finance (DeFi) projects – a type of platform that connects buyers and sellers without the need for traditional intermediaries like banks – and a series of non-fungible tokens, a type of digital asset.
Meme coins are crypto tokens that feature branding or names referencing memes or internet trends. They are usually highly volatile and have scant practical use. Trump’s coin, for example, is intended as an expression of support for the president’s call to ‘fight, fight, fight’ after he was shot at a campaign rally last year.
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