Trump's $TRUMP meme coin spikes then plummets in value

President Donald Trump's recent endorsement of the $TRUMP meme coin has caused its value to spike before quickly declining again. In a post on Truth Social, Trump expressed his enthusiasm for the coin, leading to a surge in trading volume. However, just hours later, the coin's price dropped significantly, indicating market volatility. The $TRUMP token, which is based on Solana, saw its price increase from $10.93 to a high of $12.24 following Trump's endorsement. Despite this brief excitement, it fell back to $11.85, continuing a downward trend from its peak of $73.4 in January. The trading volume soared by 288%, making it the most traded meme coin for the day. Nevertheless, some investors faced losses, with one losing $207,000 shortly after buying $5 million worth of the coin. Trump's relationship with the $TRUMP token has changed dramatically. Initially, he distanced himself from it, but now he actively promotes it. This shift has generated scrutiny since the majority of the token's supply is owned by entities linked to Trump. Critics raise concerns about potential insider trading and financial exploitation. Lawmakers are also taking notice. Democratic Congressman Sam Liccardo is proposing the MEME Act, which seeks to prevent federal officials from profiting off meme coins. Liccardo argues that the First Family's involvement could lead to dangerous financial practices. Currently, the Securities and Exchange Commission has not intervened, as meme coins do not fall under their regulations. In addition, there is concern about future volatility. On April 18, a large amount of $TRUMP tokens will be unlocked, potentially impacting the market. Analysts warn that a few large holders hold the majority of the tokens, which could lead to market instability if they decide to sell. Meme coins, including $TRUMP, are becoming increasingly popular in the crypto market, but they are known for their risks. Unlike more established cryptocurrencies, meme coins rely heavily on hype and endorsements. Trump's promotion may have temporarily boosted the coin, but it raises questions about its future amid growing political and regulatory scrutiny. Investors and the public are watching closely to see how this situation develops.