Analyst Takes: TRUMP Memecoin

Analyst Takes

Danny Knettel

A Bid for Attention

TRUMP was a clear and obvious immediate liquidity and attention blackhole for all existing Solana memecoin capital and other onchain risk capital. All onchain traders debated rotating their positions, and capital flowed en masse from all other Solana tokens into TRUMP. This event cemented Solana as THE onchain trading venue.

This token launch served as one of the largest user onboarding events for crypto as more than 400,000 new users onboarded via Moonshot in the 24 hours following the launch. Furthermore, Trump’s brand has the ability to massively expand the market for onchain meme trading from crypto-natives to non-crypto-native Trump supporters. FOX News and other Trump-favoring media are likely to freely advertise the token and tout its valuation as a measuring stick of his success and greatness.

The decision to launch TRUMP through Pump.fun in partnership with Meteora and Moonshot, rather than centralized exchanges, exemplifies the ongoing shift from CEX to DEX trading, though CEXs quickly moved to list the token to capture trading volumes. This transition is further reinforced by Robinhood's Moonshot partnership. Applications like Phantom, Moonshot, and others have dramatically streamlined onchain trading for newcomers, setting the stage for enhanced social trading features and community speculation. In the wake of TRUMP's launch, both existing traders and a new wave of participants are increasingly focused on tracking and capitalizing on trending tokens. This successful blueprint is likely to attract high-profile figures beyond the typical crypto personalities of 2021 who may seek to leverage their substantial followings in the token marketplace. Such developments would likely trigger further capital rotation as these new attention-grabbing tokens suck liquidity away from existing memecoins and onboard additional retail participants.

While TRUMP is explicitly a commemorative memecoin today, we find it likely that commemorative memecoin teams will explore attention-grabbing tactics and utility-like features. This might include burning or donating portions of locked supply, rewarding token holders over a certain threshold with novelty experiences or perks (e.g. meet the President, a trip to Mar-a-Lago), or potentially even incorporating TRUMP into a Strategic Reserve or Treasury related initiative. Unique perks have been offered in previous Trump NFT sales and set a precedent for how the team may market this token in the following weeks to months.