Donald Trump’s surprise launch of the Official Trump (TRUMP) and Melania (MELANIA) memecoins just days before his inauguration has ignited both excitement and outrage in the crypto world. These tokens surged briefly, with TRUMP hitting a high of $72 on January 19 before plummeting to $37—a 49% drop. The coins have drawn first-time crypto investors but also left many nursing substantial losses, according to NFT Evening.
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Crypto analyst Ryan Lee told Cointelegraph that the memecoins have “drawn new investors into the space,” though their speculative nature has made them a double-edged sword. Legal experts predict lawsuits are inevitable as disgruntled investors look to recover losses. “There’s a 100% chance of a civil lawsuit within two months,” said crypto lawyer Preston Byrne.
Legal Risks Cloud Trump’s Crypto Foray
The legal implications of TRUMP and MELANIA tokens remain murky. Crypto lawyer Aaron Brogan explained that memecoins often exist in a “litigation vacuum” because they don’t meet the Howey test to be classified as securities. Despite this, Brogan believes that lawsuits are likely, stating, “The torrent of legal filings is about to make Noah’s great flood look like a sun shower.”
Adding fuel to the fire, California Representative Maxine Waters warned that Trump’s memecoin ventures could pose national security risks. Meanwhile, Trump’s team appears prepared, embedding terms of service that limit litigation and require arbitration. However, as crypto lawyer Josh Lawler told Cointelegraph, secondary market participants might challenge these terms.
Memecoins Drive Crypto Popularity but at a Cost
The memecoin launch triggered a surge in crypto interest, with Google searches for “crypto” hitting their highest level since Bitcoin’s 2021 peak. On January 22, crypto trading apps dominated the U.S. Apple App Store, and Solana saw a record 9 million new wallet addresses, according to Copper.co.
While Trump’s memecoins have undeniably put crypto in the spotlight, critics like Coffeezilla argue the launch “should be a crime.” With prices down 53% from their peak, many investors face losses, highlighting the risks of speculative tokens tied to political figures.
As Trump-inspired memecoins like TRUMP and MELANIA spark legal debates and volatile price swings, and platforms like Binance enable users to create their own tokens, the crypto landscape is evolving at lightning speed. Staying informed has never been more crucial for investors, and this can be achieved by leveraging tools like TipRanks’ Cryptocurrency Center to track their favorite cryptos. Click on the image below to stay ahead in this rapidly changing space.
