Trump Meme Coin Price Plummets as Whale Dump Triggers Sell-Off

The Trump Meme Coin, crashed to unprecedented lows on Saturday, the coin’s price plunged to $27, marking a 63% decline from its all-time high. The token’s market cap nosedived from a staggering $14 billion to $5.3 billion in a matter of days.

On-chain data reveals that large-scale investors, often referred to as “whales,” have been offloading their positions en masse. This has left a majority of retail investors, who bought in during the coin’s meteoric rise, holding nearly worthless tokens.

“This is a textbook example of what happens when meme coin mania fizzles out,” said Clara Roberts, a blockchain analyst at Nansen. “Whales dominate the market early, cash out massive profits, and leave smaller investors stuck in the aftermath.”

Whales Cash Out Millions

Data from Nansen illustrates the scale of these liquidations. The most profitable Trump Meme Coin investor reportedly made $53 million and has fully exited the market. The second-largest investor cashed in $44 million, retaining only 30% of their holdings. Meanwhile, the third-largest investor made a $42 million profit but continues to hold $12 million worth of tokens, likely betting on a potential recovery.

These exits follow the typical lifecycle of meme coins, which tend to skyrocket in value during the initial hype phase but rapidly lose steam when the market cools.

“The speed of this token’s rise was unsustainable,” Roberts added. “Most meme coins lack intrinsic value or utility, making them incredibly volatile.”

Decline in Smart Money Investors

The Trump Meme Coin’s collapse isn’t just about whales. Smart money investors—defined as experienced market participants with a history of profitable trades—have also been fleeing the token.

Last week, there were 340 smart money investors in the Trump Meme Coin market. That number has now dwindled to just 130, with the amount of tokens they collectively hold falling from 30 million to 14.4 million.

“This signals a lack of confidence even among seasoned investors,” said Michael Andrews, a crypto market strategist at Glassnode. “When smart money exits, it’s a red flag for everyone else.”

Political Scrutiny Intensifies

The dramatic crash of the Trump Meme Coin has caught the attention of lawmakers in Washington. Senator Elizabeth Warren and Representative Jake Auchincloss have raised concerns over potential market manipulation and the possibility of foreign actors using the tokens to influence U.S. politics.

“These meme coins pose a significant risk,” Warren said in a statement. “They’re not just financial tools; they could also be exploited to undermine our democracy.”

The lawmakers have urged the U.S. Office of Government Ethics (OGE) and the Securities and Exchange Commission (SEC) to launch an investigation into the Trump Meme Coin.

Legal Trouble on the Horizon?

The Trump Meme Coin’s nosedive could also pave the way for legal action. Investors who have suffered massive losses may pursue lawsuits against the creators of the token, citing potential violations of securities laws.

This wouldn’t be the first case of its kind. Recently, a group of investors filed a lawsuit against influencer Hawk Tuah Girl after her HAWK token crashed. The plaintiffs alleged that the token was an unregistered security and that they were misled by promotional efforts.

“If a lawsuit is filed against Trump and Melania for promoting these coins, it could trigger even greater sell-offs and deepen the market crash,” noted Jennifer Klein, a securities lawyer specializing in crypto cases.

What’s Next for the Trump Meme Coin?

With the Trump Meme Coin trading at historic lows and facing mounting scrutiny, its future looks uncertain. Retail investors who entered the market late are calling for accountability, while regulatory bodies weigh their next moves.

Meanwhile, the meme coin’s collapse serves as a stark reminder of the risks associated with speculative crypto investments.

“Investors need to understand that meme coins are highly volatile and often lack any real value,” said Andrews. “The hype can be tempting, but the risks are enormous.”

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