$MELANIA token soars 12,000% in 24 hours as First Lady's inauguration-day crypto launch drains market liquidity and raises ethical concerns.
On January 20, 2025, just hours before Donald Trump's presidential inauguration, a new cryptocurrency rattled both the crypto market and political sphere. The launch of Melania Trump's meme coin ($MELANIA) spooked investors, draining more liquidity from Bitcoin and the altcoin market and setting off a frenzy of Trump-related meme tokens which 99% of quickly died.
The dramatic entry of the incoming First Lady into the digital asset space, following closely on the heels of her husband's $TRUMP token, has also raised huge concerns about ethics, security, and the future and regulation of crypto under the Trump administration. It’s a bad look for the industry, and the question now is can we expect more of the same or will he deliver on his 2024 promises? Can’t be worse than Operation Chokepoint 2.0 right? Right??
A Tale of Two Tokens
Just hours before Donald Trump's presidential inauguration, Melania Trump announced her own Solana-based meme coin through her social media accounts.
The timing couldn't have been better with Trump sentiment running sky-high in the US. Copying her husband’s playbook, the $MELANIA token surged an astronomical 12,000% within its first 24 hours, spreading to 45,000 wallets and reaching a peak market capitalization of $2 billion before retreating to $690 million at the time of writing.
Source: CoinMarketCap
The launch created instant millionaires. One savvy trader turned an $800,000 investment into $16.45 million within just 12 hours, while another transformed $560,000 into $11.5 million. These explosive gains came at a cost, however – Donald Trump's own meme coin saw its value plummet 38% as traders rushed to capitalize on his wife's competing token.
Broader Market Impact
While Bitcoin maintained relative stability around the $102,000 mark, almost all cryptocurrencies saw red, with meme coins and AI agent tokens impacted the hardest as the most risk-on crypto categories, as traders redirected their attention to the new presidential tokens, thereby sucking most of the liquidity in the market for altcoins.
Red Flags: 90% Supply Wallet and College Kid Launch
While champagne corks were popping for early investors, blockchain experts were raising eyebrows. The project's website, which appeared just 24 hours before launch, promised a careful distribution of tokens - 35% for team vesting, with matching 20% allocations for treasury and community.
However, blockchain analytics platform Bubblemaps revealed a stark contradiction: nearly 90% of the token supply was concentrated in a single wallet, completely at odds with the promised distribution.
This revelation shocked the crypto community, which has seen pretty much everything in recent years, with many experts raising alarm bells about potential manipulation.
Coinbase executive Conor Grogan offered a particularly pointed assessment, suggesting that while an outright "rug pull" might be unlikely, the project appeared far less professionally managed than the original $TRUMP token.
“This one honestly looks like college kids," Grogan noted, pointing out that the creator wallet was funded through a Solana memecoin launchpad known for speculative ventures. He has since alleged that Melania’s token is connected with a failed Barron meme coin.
Trump Mania Stress Tests Phantom Wallet
The sudden influx of trading activity strained Solana's infrastructure, with the Phantom Wallet reporting an unprecedented surge of 8 million requests per minute. This technical stress test exposed potential vulnerabilities in the ecosystem, even as questions about the project's fundamentals multiplied.
Making Financial Crime Great Again?
Beyond the technicals, the launch has sparked intense debate about the ethical implications of sitting presidents and their families launching speculative digital assets.
However, Trump cleverly launched the coin in the small window between the departure of SEC chairman Gary Gensler and his inauguration, as no sitting president is allowed to promote financial investments. He would’ve been thoroughly briefed by legal counsel before taking this step.
Even if it was all legally done, Donald Trump has campaigned on the promise to become a "crypto president" and establish a federal Bitcoin stockpile. The opportunistic and pioneering launch of these family-branded tokens creates potential conflicts of interest that regulators and lawmakers will need to address.
As crypto trader William Scythe observed, "This is a very sad day for America when the President realizes he can scam people himself, going from the most anti-crypto to a crypto maniac."
Others, like Custodia Bank CEO Caitlin Long, see potential silver linings, suggesting that Trump's personal stake in the crypto market might drive positive regulatory changes.
Conclusion
The $MELANIA token launch appears to be a cynical cash grab that took Trump’s meme coin shills a step too far, and opened investors’ eyes about the urgent need for clearer guidelines around political figures' involvement in cryptocurrency markets.
While early investors have reaped substantial rewards, the concentration of tokens, hasty launch, and questions about professional oversight raise serious concerns about the project's long-term viability and implications.
As Donald Trump takes office with promises to reshape America's relationship with digital assets, the controversial launch of these family-branded tokens will hopefully not set the tone for cryptocurrency regulation and adoption during the Trump presidency.
The focus should now be on milestones like the establishment of a Bitcoin Strategic Reserve, new pro-crypto cabinet members like the new SEC Chair Paul Atkins, the approval of more ETFs like Solana’s, the dropping of SEC cases against US crypto firms, and, yes, the freeing of Ross Ulbricht.
These are the confirmations that the crypto community should be on the lookout for now in the coming weeks to predict its path over the next four years.
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