The company behind Truth Social, the social media platform associated with former US President Donald Trump, announced it will soon issue a new cryptocurrency specifically for its shareholders. This move marks the Trump family’s continued interest in digital assets, a venture that has reportedly generated hundreds of millions of dollars while also raising concerns about potential conflicts of interest.
On Wednesday, Trump Media and Technology Group revealed details about the new digital token, stating shareholders will receive one token for each share they own. Trump, who holds the majority stake in the company, has shown support for reduced regulations in the cryptocurrency sector, aligning his interests with the burgeoning industry.
Following the announcement, shares of Trump Media experienced an uptick, reflecting investor optimism about the new venture. The distribution of the token is set to occur in collaboration with the Crypto.com exchange, and the token will function on the Cronos blockchain.
Devin Nunes, the chief executive of Trump Media, described this initiative as a “first-of-its-kind token distribution” designed to reward shareholders and promote transparency in the marketplace. Nunes, a former California Representative and current Chair of the Intelligence Advisory Board at the White House, provides insights to Trump on intelligence matters related to the administration.
The company did not provide a specific timeline for when shareholders will receive the tokens but hinted at offering “various rewards” for token holders, including discounts on products from Trump Media. Since its inception in 2021, the company has expanded its reach into the cryptocurrency sector while also exploring artificial intelligence and financial services. However, its share prices have plummeted by more than 60% this year.
Since Trump re-entered the political landscape, he has advocated for more favorable regulations for cryptocurrencies and trading platforms, which have poured significant financial support into the 2024 presidential election, including backing for Trump himself.
Critics of the Trump’s crypto endeavors have expressed concerns about the potential for conflicts of interest stemming from the businesses he and his family have launched in the crypto space. These ventures include the TRUMP meme-coin and associations with World Liberty Financial, a Trump-backed finance project, both of which have been financially successful.
In the summer, Trump signed the first major national legislation aimed at regulating cryptocurrencies, a move seen as legitimizing the industry and helping integrate it further into the mainstream financial ecosystem. His administration has also been noted for retracting several enforcement actions against crypto companies while facilitating easier access for Americans to invest retirement savings in unconventional assets like cryptocurrencies.
Notwithstanding the seemingly crypto-friendly political atmosphere, investors have shown a tendency to withdraw from crypto investments as the market has fluctuated in volatility this year. Bitcoin, for instance, is expected to report an annual loss after experiencing a significant decline from its record highs in October. Similarly, some of Trump’s crypto initiatives have not gone as planned; the TRUMP meme-coin, launched shortly before his inauguration, achieved high value initially but has since plummeted by over 90%.
