Crypto News Today: Why Are Trump-Family Memecoins Causing a Controversy?

When Melania Trump launched her own memecoin over the weekend, positioned to rival Donald Trump’s $TRUMP, the crypto world was thrown into chaos. What followed was a dramatic rollercoaster of price jumps, sharp declines, and market drama that left even seasoned traders scratching their heads.

As $TRUMP took a 40% hit before rebounding, Melania’s coin saw a stunning rise — only to crash shortly after.

But what’s behind the hype, and what does it mean for the broader market? Read on to find out.

The $MELANIA Coin

“The official Melania meme is live,” Melania Trump announced on X, linking to a site where people could buy her cryptocurrency. “You can buy $MELANIA now,” she said.

Within hours, $MELANIA’s price shot up to over $12 per token, reaching a market cap of $12 billion. However, the excitement quickly faded, and the coin dropped to $5.97 at press time, showing just how volatile the world of memecoins can be.

Trump Coin Recovers

Despite the initial drop, $TRUMP bounced back above $64 after Robinhood listed the coin on its platform. The listing sent $TRUMP’s market cap to $14 billion, pushing it into the top 20 cryptocurrencies. However, the coin’s rise was short-lived as traders moved toward Melania’s coin.

Controversy Brews

Crypto influencers and experts quickly weighed in. Mario Nawfal joked on X, “Looks like crypto is becoming a family business.”

Besides, Democratic leader Ro Khanna expressed concerns about market volatility noting that elected officials should be barred by law from having meme coins. 

“Elected officials must be barred from having meme coins by law. Meme coins are highly speculative and like gambling must be regulated by the SEC. They are neither neutral money (not controlled by insiders) nor platforms for innovation,” Ro Khanna noted.

Former Trump advisor Anthony Scaramucci criticized the focus on meme coins, claiming Melania coin’s launch caused the Trump coin to crash. He sarcastically remarked that this attention on coins, just before Trump’s inauguration, shows his priorities.

Scaramucci also warned that the Trump coin poses a serious risk, allowing anyone globally to easily deposit money into the president’s account, making favors—geopolitical, corporate, or personal—potentially for sale.

$TRUMP and $MELANIA Suffer Major Losses

The situation around both coins has been chaotic. Analysts from The Kobeissi Letter called the market movements “beyond insane,” noting that $TRUMP lost $7.5 billion in market cap in just 10 minutes after launch.

Since Trump’s inauguration, $TRUMP has fallen over 30%, with $3.5 billion of its market cap disappearing in under one hour. As of now, $TRUMP is trading at $41.52, down 35% in the past 24 hours. Meanwhile, $MELANIA is also down over 35% since Trump’s speech.

What Critics Are Saying

Critics argue that the Trumps’ involvement in memecoins hurts the credibility of other legitimate crypto projects. Nate Geraci, President of ETF Store, stated that traders of these coins are aware they’re betting on highly speculative assets, not investing in real projects.

Many in the crypto space share this concern, saying that the Trumps’ actions could overshadow cryptocurrency projects with genuine utility.