Recently, President Trump (and First Lady Melania Trump) released their own meme coins—$TRUMP and $MELANIA. The crypto world has seen its fair share of speculative and questionable digital assets, these coins take things to a whole new level. This isn’t just another crypto token – its a masterclass in leveraging political power for private gain. It’s essentially a How To Be Corrupt instruction manual that we’re reading in real time. 

Investing in crypto requires a little more due diligence than investing in the stock market. Its been flooded with scams and thefts and the government wont be bailing out investors. The last thing you want is to invest in crypto only to discover it’s under SEC investigation. It involves learning the rules so you you have the benefit of good judgement (I've previously written about what happens when crypto has problems) You only want to invest in something that isnt violating laws. Is it legit? And to determine that, there’s the Howey Test (also written about previously). 

A coin is a security if:

1. There’s an investment of money—people are putting in money.

2. In a common enterprise—everyone is pooling their money together.

3. With the expectation of profit—investors are hoping to make a return.

4. Based on the efforts of others—the profits depend on the work of someone else.

If the coin behaves like a security, then you need to make sure that the coin youre buying has been registered with the SEC and everything is legal. 

What about meme coins?

Meme coins serve no practical financial purpose. They don't reduce lending costs, offer better interest rates, or make transactions more efficient. These coins exist purely for speculation. They add no real value to the financial system and provide no tangible benefits to everyday consumers. They're essentially digital tokens whose only purpose is to be bought and sold for profit, without delivering any meaningful financial services or improvements to the way people manage, move, or access money. 

Is $TRUMP a security? 

 "Trump Memes are intended to function as an expression of support... 

not intended to be an investment opportunity."

The Howey Test...

• People are buying it, creating a market  ✔

• With the expectation of profit - Profits depend on the efforts of Trump and his team  ✔

• Based on the efforts of other - Value explicitly tied to Trump's presidential actions and policies  ✔

$Trump coins arent supposed to be an investment, but they do have the characteristics of them. If $TRUMP and $MELANIA were purely symbolic, their prices wouldn’t fluctuate. The Trump organization holds a large share of the total coin supply and so they control its scarcity and value. This means they can artificially influence the price by selling large amounts, which would crash the market. Or they can hold on to the supply, which increases demand and raises the price. Cryptocurrencies are supposed to be decentralized - like Bitcoin where no single person controls most of the supply. $TRUMP coin is in the hands of Trump and his inner circle. This means it also has the added risk of a Pump and Dump or rug pull.

Buyers expect gains, making the “not an investment” claim weak. Trump’s brand adds speculative value, and regulators focus on substance over labels. Expecting profit based on his influence could classify the coins as securities.

It wasn’t long ago that Trump dismissed cryptocurrencies altogether. During his first term, he tweeted:

"I am not a fan of Bitcoin and other Cryptocurrencies, which are not money

 and whose value is highly volatile and based on thin air."

• - Trump

Under his administration, regulators cracked down on Initial Coin Offerings (ICOs), and the IRS took aggressive steps to enforce crypto taxation. Fast-forward to 2025, and Trump has not just embraced crypto, he’s making billions of dollars. 

So, what changed?

The crypto industry poured over $200 million in direct donations into Trump’s re-election campaign, with even more funneled through industry Super PACs. Major firms like Ripple, Coinbase, Kraken, and Circle made substantial contributions to his inaugural fund. Trump changed his tune and him and his family have jumped in to the crypto world. Theres nothing wrong changing your mind. There is a problem with having this inside knowledge and using it to make money. 

2024 Post Election

Lets go back in time to right after the election. After a candidate wins an election and before theyre inaugurated, they spend this time planning how their administration is going to function, what changes they will make. They’re receiving classified briefings, meeting with leaders, regulators and CEOs and for Trump, preparing hundreds of executive orders he will go on to sign after being sworn in. One of these orders is a strong endorsement and promotion of the cryptocurrency industry. 

3 Days before Inauguration 

Its now 3 days before inauguration and Trump is at a private crypto ball to welcome him and his administration into Washington. The biggest names in crypto are there and also policy makers. The inner circle of guests there know that changes to crypto will be one of the administration's first major policy moves. “The reign of terror against crypto is over,” David Sacks, a venture capitalist and the new White House AI and crypto czar, told the crowd. In other words, the crypto industry is getting a big boost  from the president. Anyone with this knowledge could buy up a lot of crypto before inauguration to make millions of dollars.  

And this is when Trump announces his meme coin.

“It’s time to celebrate everything we stand for: WINNING! 

Join my very special Trump Community. GET YOUR $TRUMP NOW.”

• - Trump

When it hit the market, it was $10. it jumped over 1,000% in two days to as high as $75.35 on Jan. 19. The beauty of it is that Trump doesnt just make money from selling the coins, he makes money every time a coin is resold. All of the buying, selling, trading transactions cost money, and Trump gets that money. The Trump organization made an estimated $58 million in trading fees alone by Monday, without selling a single coin.

Media reporting says the Trump meme coin now accounts for a 89% of Trump’s net worth. Can you imagine making billions of dollars pretty much out of thin air, over the span of a weekend? By the time the inauguration started, $TRUMP and $MELANIA were worth a combined $9.5 billion

Trump and Melania arent the only ones that just struck oil. The whole family is cashing in.

Enter World Liberty Financial (WLF), created by Trump’s sons 2 months before the election. WLF is a crypto bank where customers can borrow, lend and invest in digital coins. Anyone can buy its token - $WLFI of which the Trump family owns 22.5 billion.  ”$WLFI” tokens are valued at $337.5 million, based on the price of 1.5 cents per token at launch.

While $TRUMP and $MELANIA coins are selling like crazy, his sons - WLF are busy loading up on cryptocurrency. They arent going to miss out on a chance to make money.  

Their wallet address bought $46.8 million worth of Ether & $46.7 million in wrapped Bitcoin within four hours.

To Recap: 

President Trump and his family know he’s going to change the regulation of the crypto industry. Before he’s inaugurated, Trump releases and promotes a meme coin. This coin is marketed as just for fun, but it has all of the characteristics of a security, and in any other administration, would be in violation of the SEC. Since Trump is in charge, he has full control over the industry and he’s not worried because he can (and will) fire anyone who investigates him.  

He uses his inside knowledge and power to cash in and make billions of dollars. People of course buy his coin because hes the president. His sons cash in on the action too, buying as much crypto as they can before Trumps announcement when the market will soar.

Norman Eisen, Obama's former ethics advisor, described it as the "single worst conflict of interest in the modern history of the presidency," He might be underselling it.

This isn't even about one meme coin or even crypto in general. It's using political power for personal enrichment. Trump didn't just blur the line between public office and private gain – he erased it completely.

Previous presidents placed their assets in blind trusts because their interest was in running the country, not using it as a tool to make more money. Trump has created new assets with his presidential power as their sole value proposition. The meme coins aren't providing better financial services or solving real problems – they're pure speculation  and backed by the assurance of favorable regulation from their own creator. 

The question isn't whether it's a conflict of interest – it's whether our system is equipped to handle this obscene abuse of power.  It's a stress test of our entire system of ethical governance. And so far, the system seems to be failing, for many different reasons. If a sitting president can create wealth for himself out of thin air, what does that mean for democracy?

For those of us who believe in crypto's potential to create more transparent, fair financial systems, this feels like a step backward. As someone who is invested in crypto's future, I'm concerned.