The crypto wallets that invested the largest sums in TRUMP largely purchased the coin on January 18, the day it launched, according to Nansen analysis. The wallets that achieved the greatest return on their TRUMP investments, meanwhile, had largely sold off their holdings by January 20, by which time the price had already tumbled from its peak. The circulating TRUMP coins are now valued at $5.4 billion.
“The earlier you are, the more you can bet. But if you’ve bet a lot, it doesn’t make sense to stay a long time, because it’s not going to be [the next] Apple or Nvidia,” says Barthere. “There is zero value. So for sure it’s going to go down.”
Among the wallets that have profited most handsomely from TRUMP, Nansen data shows, are many that dealt in comparatively small sums, which implies that some regular people managed to beat the crowd in the same way as the big early traders. In the midst of the high-value trades placed by J9tXv and others in the minutes after TRUMP launched, armchair traders were throwing down as little as 50 bucks.
Beyond an incredible stroke of fortune and gall, Sibenik and Powers claim, only one other theory could explain traders plowing hundreds of thousands of dollars into TRUMP so soon after it was unveiled: The trades were placed by automated sniping bots.
Sniping bots are typically programmed to snatch up multiple different coins immediately after launch, says Powers. Some of the wallets used to place the early high-value TRUMP trades do contain tens of other memecoins, but others, including J9tXv, contain only a few.
“What we would not expect to see from a bot would be an acquisition of one token only with a large position, especially if that token hadn’t been previously announced. That activity seems too specific,” says Powers. “How do you code the script for a bot to acquire one token before you know it exists?”
Most sniping bots are also programmed to deal in smaller dollar amounts, says Sibenik. “[The big early traders] either being insiders or having insight from another party are more likely explanations, especially given the very large amounts invested,” Sibenik says.
In the absence of any rules governing memecoins in the US, it may not necessarily be illegal for an issuer to give early notice to select parties.
Recently, multiple federal lawsuits brought by investors have sought to argue that memecoins should fall under securities laws, governed by the Securities and Exchange Commission, a regulatory agency tasked with protecting US investors. But in an interview on January 23, venture capitalist David Sacks, appointed by Trump as the US AI and crypto czar, claimed that memecoins should be treated as a type of collectible, an unregulated asset class.
In an executive order signed on January 23, Trump established a “working group on digital assets,” which he tasked with recommending appropriate crypto-related regulation and legislation.
“The cryptocurrency industry is still driving for clarity on regulation. The major players want to be seen as good faith actors in financial markets,” says Powers. “There has been some disgruntlement expressed from within the [crypto] industry of this memecoin offering seeming to take advantage of the moment.”
At the foot of the TRUMP website, a small-print disclaimer asserts that the memecoin is “not intended to be, or to be the subject of, an investment opportunity, investment contract, or security of any type.” The terms and conditions, meanwhile, stipulate that investors must waive the right to bring a class action lawsuit in relation to the memecoin. They also claim that investors are not entitled to pursue damages, even in the event of “deceptive and unfair trade practices” and “misrepresentation” on the part of the Trump-affiliated company administering the coin.
“That’s a stunning caveat,” says Powers. “Whether those kinds of waivers and disclaimers would actually hold up in court is another matter. But setting down the road with that attitude is not in keeping with the hope of the crypto industry to turn the page on what came before.”
