From Trump to Milei: Presidential memecoins roil the crypto market

The crypto market has no peace. The return of Donald Trump to the White House has been a roller coaster for the sector, and the president’s attitude towards the industry has infected some of his counterparts around the world. A few days before his inauguration, he launched the $TRUMP and $MELANIA memecoins, which in a matter of hours were worth more than $15 billion dollars (just over €14.3 billion). A few weeks later, the president of the Central African Republic, Faustin Archange Touadéra, created $CAR in his own image. A few days ago, Javier Milei of Argentina jumped on board and turned to the social media platform X to endorse a new cryptocurrency called $LIBRA. But his support was short-lived: the same day he regretted it, said he was not tied to the project, and deleted his tweet. In all three cases, the result was the same. After a dizzying rise in the value of the asset, unchecked falls followed, leading to the almost total loss of the value of the token (asset), which left investors empty-handed.

The launch of $TRUMP and $MELANIA was a first warning sign. High volatility and the speculative wave left money in the hands of the few, who made easy returns to the detriment of less experienced investors. The tokens plunged by 76% and 90% respectively. The industry complained: the launch of these meme cryptocurrencies — digital assets without a technological base to support them that soar in the heat of social networks, following user trends and sentiment — go against the grain of what the industry is looking for, i.e. to strengthen its credibility and trust among investors and regulators.

But it was not an isolated case. Faustin-Archange Touadéra, president of the Central African Republic, recently launched the memecoin $CAR, aimed at financing development and strengthening the region’s economy. The country of some 5.7 million people is already familiar with crypto. In 2022 it became the second nation in the world, after El Salvador, to adopt bitcoin as legal tender. However, the experience was short-lived, as the measure was declared unconstitutional and had to be reversed.

The fate of the memecoin $CAR was even worse and its start was bumpy. After the launch, X suspended the account created by the government to promote the asset due to suspicions about the legitimacy of the project. In addition, deepfake detection tools flagged the president’s video as suspicious. But Touadéra assured that it was all real and continued to support it: “The launch of $CAR has been a success!” he said on X, even as it lost all its value: from its highs of 0.66 cents on the day of its launch, it is now worth 0.017, according to Coinmarketcap. Although widely ignored, this was a second red flag.

The announcement made by President Javier Milei of Argentina last Friday was the straw that broke the camel’s back. In a tweet, the president promoted the $LIBRA cryptocurrency, a project by a private company inspired by his own liberal ideas: “This project will be dedicated to encourage the growth of the Argentine economy, funding small companies and Argentine enterprises,” he said. In less than two hours, the token went from 0 to $4.5 billion capitalization, which vanished in a few minutes. The wallets that concentrated most of the tokens withdrew more than $90 million and the cryptocurrency collapsed. This was compounded by suspicions about the project’s fundamentals that sent investors fleeing. The token eventually lost 97% of its value.

Judith Arnal, a senior researcher at the Elcano Royal Institute, explains that this is a classic rug pull scheme: “It involves heating up the market with the support of people with high public visibility in order to attract many investors, so that the price rises and the promoters withdraw” with the profits. Andrea Venturelli, founder of DECRYPTO, adds another observation: “Before the promotion of the token, influencers and prominent figures in the crypto world already knew about the launch and this allowed them to position themselves ahead of the public,” to the detriment of the retail investors, who were guided by a recommendation from a political figure like Milei.

Faced with an avalanche of criticism, Milei disassociated himself from the project. He deleted the tweet and assured that he had no connection with the token whatsoever. “I wasn’t aware of the details of the project and after I became aware of it, I decided not to continue disseminating it”, he said as way of justification. But it was too late: this alleged mega-scam has affected more than 40,000 people with losses in excess of $4 billion. Numerous complaints have been filed against the president, accusing him of illicit association, swindling and breach of duty as a public official. The damage to Milei’s image is yet to be seen, but the impact on the crypto market is clear.

In the eyes of the industry, these events tarnish the industry’s reputation. Javier Pastor, director of training at Bit2Me, is categorical: “These launches are major mistakes. We are concerned about political interference when it is not a well-considered, well-thought-out and well-formed action.” Carlos Salinas, who teaches a master’s degree in blockchain and investment in digital assets at the IEB Business School in Madrid, is more severe. “For a politician to get his hands on cryptocurrencies is nothing more than a symptom of the circus that the speculation economy has become. There are no solid projects or technological developments here, just pure financial showmanship. Prices rise and fall not because of fundamentals, but because of the degree of fanaticism of those who believe that a famous face is a guarantee of success,” he says.

Memecoin, shitcoin... The names already reflect their intrinsic value: zero. By their nature, these assets benefit from the support of a famous person, but that is only one side of the coin. If at some point that same celebrity decides to abandon the project or no longer believes in it, that asset could lose all its value. One example is Dogecoin, which has become a thermometer of Elon Musk’s mood.

The fact that prominent figures such as presidents encourage speculation with these announcements generates confusion in the sector. Manuel Villegas, an analyst at Julius Baer, acknowledges that the risk is that capital flows will be redirected to questionable value propositions. But he stresses that it is mostly just a lot of noise. “It’s negative publicity that affects the whole space in general, but in the long term it doesn’t affect the fundamentals of mainstream blockchain.” Pastor agrees with this view and laments that these launches contribute to sending the wrong message that investors could generalize to every market, damaging the image of the rest of the cryptoassets.

History repeats itself: it happened with ICOs (initial coin offerings, a method to raise resources for crypto-related projects) in 2017, with NFTs in 2021 and now with memecoins, Venturelli notes. Salinas puts a name to this phenomenon: the easy money trap. “They are not investments, they are bets. People want easy money, they dream of multiplying their fortune without effort, and they complain when the bubble bursts. In the financial jungle, it’s not the one who shouts the loudest who wins, but the one who understands the rules of the game the best,” he says. The industry appeals to the financial education of investors to surf this crowded world: three million new tokens were launched in January 2025 alone, about 100,000 every day. “Most of these have no real value or utility, generating doubts about the sustainability of this market,” Venturelli concludes.

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