Trump's cryptocurrency: Is it an opportunity or a risk for investors?

Trump's cryptocurrency: Is it an opportunity or a risk for investors?
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The announcement by former U.S. President Donald Trump about the launch of a new cryptocurrency named "Trump" (TRUMP-OFFICIAL-USD) has generated significant controversy in the cryptocurrency community. Anthony Scaramucci, founder of SkyBridge Capital, warned that individual investors may face significant challenges when dealing with this cryptocurrency due to its large fluctuations in value.

What is the Trump cryptocurrency?

The Trump cryptocurrency was launched by CIC Digital, a subsidiary of the Trump organization, under the name "Trump" (TRUMP-OFFICIAL-USD). It is being promoted under the slogan "Join the Trump community. This is history in the making!" According to available information, CIC Digital and its affiliates own 80% of the cryptocurrency supply, with plans to gradually release new tokens over the next three years, further strengthening their control over the market.

Is the Trump cryptocurrency an investment opportunity?

During his participation in the World Economic Forum in Davos, Switzerland, Scaramucci described the Trump coin as a "gambling currency" and a "meme coin." He asserted that these coins could expose individual investors to significant risks, pointing out that they lack a strong economic foundation, making them prone to sharp fluctuations. Scaramucci stated in his comments to Yahoo Finance: "Our community will always be gamblers... but this leader represents something to the rest of the countries, and at least the presidency represented something important in the past."

The rapid fluctuations in the value of the Trump cryptocurrency

The Trump cryptocurrency initially saw a sudden surge in its market value, reaching $73 billion within 48 hours of its launch, surpassing Dogecoin as the largest meme coin. However, its market value quickly dropped to $7.3 billion shortly after the rise, while Melania Trump's coin was traded with a market value of $732 million, illustrating the sharp market fluctuations.

Potential market impact: Expert opinions

Scaramucci harshly criticized the launch of Trump's meme coin, emphasizing that this represents a fundamental shift in how the United States and the rest of the world interact with cryptocurrencies. Analyst Gautam Chughani from Bernstein stated that the launch of a major political figure like Trump for a meme coin marks the beginning of a "new regulatory era" in the world of cryptocurrencies, indicating a change in how governments will interact with this technology.

Scaramucci's predictions regarding cryptocurrencies

Regarding Scaramucci's future predictions, he mentioned that his company, SkyBridge, has increasingly benefited from the growth of Bitcoin and cryptocurrencies in general, having launched the Skybridge Bitcoin Fund in 2021. He also noted that his fund contains "several hundred million dollars," which reflects an "exceptional" investment performance for 2024.

As for Bitcoin, Scaramucci predicted that its value could reach $170,000 this year, after the coin saw a notable rise following the U.S. elections. Currently, Bitcoin is trading at around $103,000, reflecting the upward trend cryptocurrencies are experiencing.

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