According to Forbes, Trump Media and Technology Group purchased $2 billion worth of bitcoin between July 1 and July 21, 2024, when the cryptocurrency was trading around $115,000. The company took on approximately $1 billion in debt to make the investment, which represented a massive bet by the former president who owns 41% of Trump Media shares. Just months earlier, Donald Trump Jr. had predicted bitcoin would surge 35% to 60% higher during a Las Vegas crypto conference. Instead, bitcoin has dropped 17% over the past month alone, reducing the company’s holdings to an estimated $1.7 billion value. Trump Media shares fell 24% following the announcement, wiping out $490 million from Trump’s personal fortune.
From crypto skeptic to bitcoin bull
Here’s the thing about Trump‘s crypto conversion – it’s a complete 180 from his earlier stance. Back in 2019, he tweeted that he was “not a fan of Bitcoin and other Cryptocurrencies” and called their value “highly volatile and based on thin air.” Fast forward to 2024, and he’s telling bitcoin enthusiasts they’re “modern-day Edisons and Wright brothers.” What changed? Well, crypto money started pouring into political campaigns, and Trump suddenly became the “chief crypto advocate.” The timing of this conversion looks pretty convenient, doesn’t it?
Truth Social’s fundamental problems
Meanwhile, Truth Social was never really working as a business. The platform struggled to attract users compared to Twitter, and then Elon Musk went and bought the real thing, reinstated Trump’s account, and basically made the whole “conservative Twitter” concept pointless. Trump Media shares tanked 68% from their peak, erasing $3.3 billion from Trump’s net worth by May. So they needed something – anything – to spark investor excitement again. The bitcoin play was supposed to be that catalyst, but investors saw right through it. Shares dropped 19% in three days after the announcement.
The classic mistake of buying at the top
Basically, Trump Media committed one of the most common investment errors – they bought when everyone was already excited. Bitcoin had just jumped 57% in the year before their purchase, and the Trump brothers were making wildly optimistic predictions about further gains. Now they’re sitting on a 12% loss from their purchase price, plus they’ve got all that debt to service. The company claims the strategy increased their assets from $274 million to over $3 billion, but that’s just accounting talk. When you buy something expensive that immediately loses value, you’re not actually richer – you just own stuff that’s worth less than you paid for it.
Investors aren’t buying the spin
And investors clearly agree. Trump Media is now worth about one-third of what it was at its peak, despite the company’s protests about “fake news” reporting. The spokesperson’s statement about growing financial assets sounds impressive until you realize they’re counting bitcoin they bought at inflated prices as assets at purchase value rather than current market value. It’s the kind of spin that might work in politics but doesn’t fly in financial markets. The real question is whether bitcoin will recover enough to make this look like a brilliant move rather than what it currently appears to be – terrible timing from a company desperate for a win.
