Melania Trump Enters the Meme Coin Arena, Prompting Ethics Concerns
Donald Trump with his wife Melania. The launch of Melania Trump’s meme coin briefly hit the price of Donald Trump’s coin. Photograph: Daniel Cole/Reuters
Melania Trump has joined her husband in the cryptocurrency arena, launching a meme coin that has immediately raised ethical questions just as the new administration plans to loosen regulations on these volatile assets.
The timing, on the eve of Donald Trump returning to the White House, has already alarmed presidential ethics experts. Digital currencies rallied as his presidential transition took place.
Market Impact and Conflicting Interests
The price of the former president’s token, $Trump, initially surged, tripling in value to over $70 shortly after its launch, achieving a total value exceeding $14 billion. However, the introduction of $Melania, his wife’s meme coin, caused a dip in those gains as investors shifted their focus.
“This may represent the single worst conflict of interest in the modern history of the presidency,” stated Norman Eisen, a former ethics advisor in the Obama administration, to the Washington Post. Eisen highlighted that Trump has “the most profound conflict of interest” in the crypto sphere, particularly considering his dual role of seeking personal financial gain while also regulating the industry.
Cryptocurrencies have experienced notable gains since Donald Trump’s election victory in November, and he has indicated plans to reduce regulations within the sector.
Cryptocurrency Trends
On Monday, Bitcoin, the most well-known digital currency, reached a new record high of $109,241, which translates to an increase of over 5%. Dogecoin, which Elon Musk, a billionaire who supports Trump, has touted as the “people’s crypto,” gained nearly 5%, and Ethereum saw a 3.5% increase, reaching $3,384.
Trump himself posted on social media to promote the launch of his token: “It’s time to celebrate everything we stand for: WINNING! Join my very special Trump Community. GET YOUR $TRUMP NOW.” CIC Digital LLC, a Trump-owned company, will own 80% of the token’s supply, according to the meme coin’s website.
Market Volatility and Meme Coin Dynamics
The token quickly entered the top 20 cryptocurrencies. The digital rush reportedly caused a drain on liquidity in the rest of the market as analysts noted high trading volume. This caused other coins to decrease in value as traders sold their existing holdings to purchase Trump’s coin.
Melania Trump’s launch seemed to have a similar unintended impact on the market, as some traders shifted from Trump’s meme coin to her new coin. “The Official Melania Meme is live! You can buy $MELANIA now,” she posted on X, which was reposted by her husband.
Shortly after the launch of $Melania, the price of $Trump fell by over 50% before regaining some value in the following hours, reaching around $64. The market capitalization of $Melania reached as high as $13 billion.
“This is beyond insane,” observed analysts at The Kobeissi Letter on X. They followed up with, “Less than 48 hours ago, Donald Trump launched $trump which just erased $7.5bn in market cap in 10 minutes. In the minutes around the launch of Melania Trump’s token, we saw massive sell orders in $trump.”
A meme coin, a type of cryptocurrency, is inspired by trends like internet memes and often lacks inherent utility, leading to large price fluctuations and crashes.
Concerns and Disclaimers
Meme coins have been characterized by traders as a “pure form of gambling” and comparable to buying a lottery ticket.
While the nominal value of the Trump-affiliated meme coins rose to billions of dollars, it would practically be difficult to realize such a large sum by selling the tokens without significantly affecting the price. They could, however, allow Trump-controlled companies to accumulate substantial amounts of money as lock-up periods end over the next three to twelve months during his term as US president.
The $Melania meme coin is marketed by MKT World LLC, a Florida-registered company owned by Melania Trump.
The owners will be able to sell the meme coin themselves after 30 days.
“The meme coins have amplified bitcoin’s momentum, with retail traders optimistic about Trump reaffirming his commitment to the crypto industry,” Bloomberg quoted Ben El-Baz, the managing director of HashKey Global, as saying.
Some crypto enthusiasts praised the Trump meme coin’s release, viewing it as a reflection of the incoming president’s backing for an industry that they felt had been unfairly targeted by the Biden administration. Trump has pledged to introduce crypto-friendly regulations and has appointed supporters to important government positions.
However, it has also intensified concerns about conflicts of interest and criticisms about attempts to personally profit from political office.
During his presidential campaign, Trump released batches of crypto trading cards, each generating over $4 million. Eric and Donald Trump Jr. also launched a cryptocurrency venture, World Liberty Financial, in 2024, prompting worries about a clear conflict of interest.
The Donald Trump meme coin’s website contains a disclaimer stating: “Trump memes are intended to function as an expression of support for, and engagement with, the ideals and beliefs embodied by the symbol ‘$Trump’ and the associated artwork, and are not intended to be, or to be the subject of, an investment opportunity, investment contract, or security of any type. GetTrumpMemes.com is not political and has nothing to do with any political campaign or any political office or governmental agency.” Melania Trump’s meme coin website has a similar disclaimer.
