The launch of the Trump meme has stirred up the cryptocurrency world, drawing attention to its rapid rise and controversial nature. The coin debuted on January 17, and quickly gained billions in trading volume, driven in part by the endorsement of Donald Trump himself. However, the speculative nature of the currency and potential conflicts of interest have raised eyebrows. Adding to the drama, Melania Trump introduced her own Melania Coin shortly after, creating a frenzy in the market.
Despite its popularity, experts like Cathie Wood, CEO of ARK Invest, remain skeptical. Let’s dive into her perspective and why she’s staying away from the Trump symbol.
Cathie Wood’s opinion: No point, no benefit
Cathie Wood dismissed Trump’s coin as lacking real-world utility. In an interview with Bloomberg on January 22, she criticized the token for being purely speculative, noting that while some claim it may grant exclusive access to Trump, there is little evidence to support its value beyond its meme status.
Wood’s skepticism is not limited to Trump’s currency. I have consistently avoided meme currencies, focusing instead on assets with clear use cases and long-term growth potential. She stressed her preference for the “big three” in the field of cryptocurrencies: Bitcoin, Ethereum, and Solana. It believes these assets represent the future of decentralized finance (DeFi) and innovation in the blockchain space.
Concerns about focus and manipulation
Wood’s concerns echo findings by blockchain analytics firm Chainalysis, which revealed that a small group of wealthy owners control 94% of Trump and Melania’s tokens. This concentration increases the risk of market manipulation, making these tokens riskier for ordinary investors. Despite this, the Trump token has attracted a huge user base, with nearly 790,000 wallets containing the coin. Interestingly, nearly half of buyers created new wallets on the day they purchased the token, indicating a significant increase in the number of first-time cryptocurrency users.
A broader vision of cryptocurrencies
While Wood rejects Trump’s coin, her view of the broader cryptocurrency ecosystem remains bullish. She believes in the transformative power of decentralized finance, especially projects built on Ethereum and Solana, which she describes as the backbone of future financial services.
For ARK Invest, the focus is clear: avoid short-term hype and invest in assets that drive real-world innovation. She is clear about choosing long-term assets rather than fake tokens that can disrupt the cryptocurrency market.
However, she is not the only one criticizing the Trump symbol. Critics of the cryptocurrency industry from abroad have raised serious ethical and national security concerns about Trump’s meme coin. With Trump directly benefiting from the currency, some fear this could create a conflict of interest, as his financial stake could prevent him from regulating the cryptocurrency industry.
Rep. Ro Khanna even called for laws prohibiting elected officials from owning coins. Additionally, there is a fear that foreign elements could take control of the industry and manipulate Trump’s decisions by buying or disposing of the token.
