First-time crypto buyers face highest risks from Trump meme coin #CriptoNews

The new Solana-based meme coin launched by President Donald Trump earlier this month has already dipped in terms of trading volume and racked up more than $11 million in fees for traders.

In the last 24 hours, the coin reached a trading volume of $2.07 billion, according to CoinMarketCap. Its current market capitalization sits at just under $5 billion, a significant drop from the $14 billion valuation it initially had.

Since its initial launch on January 17, the meme coin has seen its value plunge more than 60%, raising concerns about the impact on retail investors.

Indeed, the traders most affected by the erosion of the token’s value remain first-time investors. “These are largely new retail buyers,” said the blockchain analytics firm Chainalysis. “Nearly half of buyers created their wallets the day they purchased the tokens.”

More than 77% of investors holding the Trump meme coin report less than $100 in profits from their investment, according to Chainalysis. The so-called “winning” investors appear to be three dozen whales who have made more than $10 million from the meme coin, Chainalysis said.

“$Trump is following a trend of ‘celeb coins’ like Iggy Azalea, that have launched over the past year,” said Tyler Tarsi, co-founder of Omni Network. “$Trump was the fastest coin ever to reach a $50 billion valuation, reaching $65 billion overnight, which is total insanity. It broke the Solana network.”

But Tarsi cautioned retail investors to be prudent and to carefully assess the underlying investment structure of the Trump tokens: “Investors considering $Trump should really watch out for how much of the supply that insiders own: 80%, which is really high (typically crypto coins are below 50%),” Tarsi said. “Trump insiders can dump tokens on investors because they own so much. In fact, according to on-chain wallets, insiders [have] already sold about $500 million after a single day of trading.”

“Its politically-charged branding, lack of utility, and volatility make [the Trump meme coin’s] long-term future uncertain,” added Fern Bamber, Content Manager at Casinos Blockchain. “As with all meme coins, the real test will be whether $Trump can sustain its momentum, or fade into obscurity like so many before it.”

While some are skeptical about the meme coin’s long-term viability, others are embracing the token’s potential use in Trump-related transactions. Recently, Trump’s network of official merchandise vendors began accepting the Solana-based meme coin, enabling investors to buy Trump-themed watches, fragrances, and sneakers with the tokens.

The Trump meme coin is currently trading at a value of around $24.89, according to CoinMarketCap.