Democrats in the U.S. have initiated a multi-faceted strategy against President Donald Trump’s cryptocurrency efforts, presenting two bills and conducting an investigation. This approach aims to limit his potential gains from these ventures.
The proposed Modern Recruitment and Fraud Enforcement Act, or MEME Act, intends to prevent federal officials from profiting off the cryptocurrency known as Memocoin. Senator Chris Murphy expressed this in a statement made on May 6.
If enacted, the MEME Act would prohibit the president, vice president, members of Congress, high-ranking executive officials, as well as their spouses and children, from issuing or promoting securities, futures products, or digital assets. This is detailed in the bill’s documentation.
Murphy later tweeted about the introduction of the MEME Act, labeling Trump Coin as a significant corruption issue during his presidency. He emphasized his commitment to combating this corruption decisively.
Those who violate this proposed legislation could face civil penalties up to $250,000 and would be required to relinquish any profits to the U.S. Treasury. Additionally, they might incur criminal penalties of up to five years in prison.
Another Democratic representative, Sam Ricardo, has also proposed similar legislation in the House. However, given that Republicans control both chambers of Congress, any legislative efforts will need their backing.
Meanwhile, Democratic Senator Richard Blumenthal, a top member of the Permanent Subcommittee on Investigations (PSI), indicated on May 6 that the committee has begun a preliminary inquiry into the Trump Coin, the Trump-backed platform World Liberty Financial, and other affiliated business activities.
As part of this inquiry, PSI has reached out to the company behind Trump Coin, requesting documents and communications between the companies and the Trump organization.
Blumenthal noted that the subcommittee is examining actions taken by the companies to mitigate any potential conflict of interest. Notably, the PSI raised concerns about an announcement from the Trump Coin website inviting top token holders to a gala dinner at the White House and the significant price fluctuations of Trump tokens, which showed a change from around $9.40 to $13.65—a nearly 50% increase.
After its launch on January 18, the Trump Coin peaked at $73.43, according to Coingecko, but has since plummeted by 85%, now trading at $11.13.
Majority of Trump Coin Holders Profiting
Data shared with blockchain analytics firm Chain Orisis Cointelegraph indicates that about 2 million wallets hold Trump coins, with an additional 54,000 acquiring tokens after the dinner announcement. However, approximately 764,000 have incurred losses, mainly among smaller investors. Yet, 58 investors have each made over $10 million, collectively amounting to about $1.1 billion in earnings.
Simultaneously, Chainalysis reports that creators of Memecoins have generated $320 million thus far, with $1.3 million earned since the White House dinner was announced.
Concurrently, logistics company Freight Technologies has announced plans to establish a Trump Coin Treasury Department with a convertible note of $20 million. CEO Javier Selgas described the tokens as an innovative method to diversify the cryptocurrency market and support fair trade between Mexico and the U.S. They also acquired a utility token worth $5.2 million recently.
