Trump media group plans new token with Crypto.com

Open Editor’s Digest for free

Rula Khalaf, editor of the Financial Times, picks her favorite stories in this weekly newsletter.

The company behind Donald Trump’s social media network announced plans to distribute a new cryptocurrency token to shareholders, sending the stock price sharply higher on the last day of the year.

Trump Media and Technology Group (TMTG), which is controlled by the Trump family, said on Wednesday that it would distribute the token “in the near future” in partnership with the Crypto.com exchange.

Shares of TMTG, which is listed on the Nasdaq, jumped more than 9 percent in New York after the announcement. The stock has fallen in recent months and remains roughly 60 percent lower than it was at the beginning of the year.

The announcement of a new token adds to the sprawling cryptocurrency interests amassed by Trump and his family’s companies.

These projects, which include memes and stablecoins, have generated more than $1 billion, according to a Financial Times analysis earlier this year, thanks in part to the White House’s cryptocurrency-friendly policies.

Founded in 2021 primarily as the holding company behind Trump’s Truth Social, TMTG has since raised nearly $2 billion in bitcoin as part of a broader push into the cryptocurrency sector.

Earlier this month, the company also moved into the AI ​​space, merging with Google-backed fusion energy company TAE Technologies in a deal valued at $6 billion, as part of a bet on nuclear energy fueling the AI ​​boom.

TMTG said its new tokens will not be transferable and “cannot be exchanged for cash.”

But it holds the potential to “provide various rewards to token holders periodically throughout the year…[which]“May include benefits or discounts associated with Trump Media products.”

The Trump family’s cryptocurrency activities have increased recently, with the Eric Trump-backed Bitcoin project soaring in its stock market debut in September.

TMTG has worked with Crypto.com on previous deals. In August, Trump’s company agreed to a $6.4 billion deal to buy a token issued by the exchange, deepening ties between the president’s businesses and the digital assets industry.

Last year, Crypto.com was one of the largest donors to groups supporting Trump. In February, she donated $10 million to MAGA Inc, a super PAC linked to Trump. The company also donated $1 million to Trump’s inauguration.

The company had faced an investigation by the Securities and Exchange Commission under the Joe Biden administration. The regulator dropped the investigation in March.