Shares of American Bitcoin, the mining and aggregation company co-founded by Eric Trump and Donald Trump Jr., experienced a notable drop on Tuesday after the expiration of a lock-up period that allowed some shares to be sold.
Key points:
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U.S. Bitcoin stocks dipped nearly 50% following the release of newly unlocked shares into the market after the lockup ended.
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Eric Trump downplayed the drop, indicating he has no intention of selling his personal stocks.
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Investor anxiety continues as ABTC is still approximately 76% lower than its highs from September, despite reporting solid earnings growth.
ABTC’s share price plummeted by almost 50% shortly after trading commenced, dropping from $3.58 to $1.80, based on Google Finance data. The stock did manage to recover somewhat during the trading session, but still finished down by 38.83%, closing at $2.19, reflecting the effects of the newly unlocked shares.
In a post on X, Eric Trump stated that the pre-merger private placement stock had just become available, and he had anticipated the decline. He mentioned that the company’s operations remain robust and reaffirmed that he intends to keep his stake. American Bitcoin made its Nasdaq debut in September after merging with Griffon Digital Mining.
Despite a significant downturn, the company reported impressive quarterly results. In October, it announced third-quarter revenues of $64.2 million, a sharp rise from $11.6 million the previous year, and a turnaround from a loss of $600,000 to a profit of $3.5 million. CEO Michael Ho noted that the company’s mining capacity more than doubled during this period, and profit margins increased substantially.
American Bitcoin is also expanding its treasury, holding about 4,090 BTC as of November 13, which includes coins in custody and those pledged for new mining equipment. The management regards this strategy as a way to boost production and increase direct exposure to Bitcoin.
Nonetheless, the limited recovery could not counteract the steep drop from September’s peak of $9.31. Currently, the stock sits roughly 76.5% below that high, indicating ongoing investor caution regarding the volatility tied to supply unlocking and early investors exiting.
This decline is also reflective of a broader downturn in crypto-related stocks. For instance, Coinbase has dropped about 20% over the past month, while USDC issuer Circle saw a 39% decline, and exchange operator Gemini fell by 47% in the same time frame.
Reports have emerged suggesting that Democrats on the House Judiciary Committee released a report alleging the Trump administration leveraged executive power to aid the Trump family’s crypto enterprise, claiming token sales could generate about $800 million in early 2025.
The report suggests a blending of public office and personal interests, estimating the Trump family’s cryptocurrency holdings might approach $11.6 billion, though pinpointing exact figures remains challenging.
Concerns have been raised about foreign influence based on the findings, particularly regarding World Liberty Financial’s investment in the $WLFI token. Lawmakers highlighted substantial investments, such as a reported $75 million from a group called the Aqua1 Foundation, acquired by crypto mogul Justin Sun amid regulatory scrutiny and with questionable corporate records.
Leaders of the fund are reportedly connected to various legal and geopolitical controversies.
