Donald Trump's trust in the cryptocurrency industry has taken a hit after Trump and his wife created their own "meme" coins - a move that critics say looks "like a bad way to make money", undermining efforts to legitimize digital assets, writes the "AP" agency.
The industry, which has been criticized for its treatment by the Joe Biden administration and spent heavily to help Donald Trump return to power, is welcoming the new president's help in making crypto a bigger part of the mainstream financial system. Trump has promised easier regulations for the industry and has appointed industry-supporting officials to key government positions.
The price of Bitcoin and other digital assets has soared since Trump's victory. A lavish crypto industry ball was held before Trump's inauguration, selling thousands of dollars in tickets and featuring a performance by rapper Snoop Dogg.
But while the party was going on, Trump announced on social media that he had created his own digital currency. The move was not well received in the digital currency community.
“I was very surprised when I saw it,” said Tom Schmidt, a partner at digital equity firm Dagonfly. “It seemed very cheap and deceptive.”
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Some digital currency fans have been mocking on social media, saying they miss Gary Gensler, the former head of the Securities and Exchange Commission who was critical of the industry.
Meme coins are the least regulated part of the cryptocurrency universe. They start out as jokes with no real value, but can grow in value if people buy them. The most famous meme coin is Dogecoin, whose mascot is a dog. Some scammers have tried to inflate the value of some meme coins to trap unsuspecting investors.
Some industry enthusiasts have welcomed the Trump coin, and have raised the value of the coin to $70. But the value of this coin fell on Sunday after the first lady also announced the creation of a personalized "meme" coin, which initially rose and then fell. On Tuesday morning, Trump's coin was worth $45, while the first lady's was worth $4.
Trump on Tuesday nominated Mark Uyeda to be the commissioner of the Securities and Exchange Commission. He immediately announced the creation of a new task force for a “reasonable regulatory path.” Trump has promised to create a national digital currency reserve and create rules to make it easier for cryptocurrency companies to enter the financial markets.
But his connection to "meme" currencies has worried digital currency fans as this will affect the implementation of reforms.
“Now, on the eve of some easing of cryptocurrency regulations in this country, the main thing people are thinking is ‘it’s just a casino for meme coins,’” said Nic Carter, a partner at cryptocurrency investment firm Castle Island Ventures. “It does the opposite of legitimizing, it makes us look unserious.”
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The sale of Trump’s “meme” coin was organized by CIC Digital, a branch of the Trump Organization. In promoting the coin, Trump told supporters to “have fun!” The coin sales website said the coins are for expressing support and not an investment opportunity. The coin website added that they have created 200 million Trump coins and plan to create another 1 billion in the next three years.
Trump's family business recently released an ethics agreement that prohibits Trump from making "day-to-day" decisions while he is president and has limited financial information about the business.
