Memecoin Meltdown? 40M Trump Tokens Set to Flood the Market Next Week

Key Insights

• $321 million worth TRUMP tokens will be unlocked on 18 April, amid an 89% dump from its January peak.
• Over 813,000 wallets have suffered losses of more than $2 billion, with the overall memecoin market cap dropping from $119B to $45B.
• Retail interest in TRUMP is dwindling, and there is a notable decline in the number of large wallet holders.
• If the unlocked tokens are sold, TRUMP's price could enter a so-called death spiral towards $5 or even lower.

The official memecoin linked to United States President Donald Trump is gearing up for a major market event soon.

Next week, on 18 April, the team behind the token will unlock a staggering 40 million TRUMP tokens, which are currently valued at around $8 apiece.

This means that about $321 million worth of memecoins will hit the market harshly and suddenly soon.

This so-called "cliff unlock" has already created concerns across the crypto community, especially since the token is down by more than 80% in value from its all-time high in January.

Here are the details of this incoming unlock and what it might mean for investors.

Trump Token: From $73 to $8

The token in question was launched on 18 January, just two days before Donald Trump was sworn in as president.

This token quickly gained traction in the market, hitting an all-time high of $73.43 on 19 January.

It rode the wave of the inauguration hype and the speculation around it, hitting billions in market cap. However, the hype didn't last.

As of April, this token has crashed to roughly $8, an 89% decline from its peak price.

Many earlier backers of the token bought close to the top and have suffered devastating losses so far.

According to Chainalysis, at least 813,000 wallets have recorded losses with the estimated total amount hitting a $2 billion ceiling.

Meanwhile, the token’s creators have reportedly cashed in around $350 million in profits.

The Token Unlock and What It Means?

The incoming $321 million token unlock is especially scary because of how likely it is to worsen the ongoing price spiral.

According to analysts, when a large amount of supply enters the market without demand to back it up, it often leads to downward pressure on prices.

In this case, the size of the unlock could be catastrophic next week.

This unlock is set to increase the token's circulating supply by an insane 20%, which is bound to test the market's liquidity.

The market’s 2% market depth figures (which measure how much capital it takes to move the token’s price by 2%) sit at around $980,000 and $2 million.

As expected, this is a meager value and is nowhere near enough to absorb an incoming $321 million dump.

It is still unclear whether the token holders who receive these tokens will sell immediately.

However, even if a portion of them manage to hold on to the tokens, the price could enter the proverbial “death spiral” and visit fresh lows of $5 or under.

Retail Participation Has Crumbled

Adding further scares to the situation, around 817,000 unique wallets held the coin when TRUMP first launched.

That number has since dropped to a disappointing 637,000, in a show of declining interest.

Even more telling is how only 12,000 wallets still hold more than $1,000 worth of TRUMP.

Back in January, this figure sat at around 143,000.

This drop in large holders shows that confidence has taken a major hit, and investors are pulling their assets out en masse.

The interesting thing about this unlock is that not only TRUMP is set to face a similar fate.

The days between 14 and 20 April will see more than $500 million worth of token unlocks, according to Tokenomist.

This list includes Fasttoken (FTN) with 20 million FTN tokens worth around $80 million, Arbitrum with over $27 million worth of tokens, and Starknet (STRK) with 127 million STRK valued at $16 million.

Each of these tokens has its fair share of risks for the bulls, but none are expected to be as devastating for the market as TRUMP.

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