Donald Trump’s election victory in the United States on Wednesday and the resulting euphoria failed to push up the price of Trump-themed memecoins, mainly due to the so-called “selling the news” trend. “. These tokens, which had seen significant gains earlier in the week, fell by double digits following his victory.
Some of the popular memecoins lost more than 25% of their market capitalization just a day after the victory, including TRUMP, MAGA, and TREMP.
Trump-Themed Tokens Suffer From “Buy the Rumor, Sell the News” Trend
The drop in PoliFi tokens occurred despite the broader crypto market rally following Donald Trump’s victory in the US election. Trump-related tokens, among others, took a hit. The drop has indeed shaken investor confidence in PolitiFi’s assets, with traders appearing to sell the news – a pattern not too different from the coins’ past behavior.
Likewise, like Dogecoin’s rapid rise ahead of Elon Musk’s appearance on Saturday Night Live in May 2021, which peaked at $0.73 and fell more than 30% shortly after, political tokens saw heavy selling following election hype. For its part, DOGE is still 74% below its all-time high at current levels.
This is part of the “buy the rumor, sell the news” trend common to event tokens which tend to be sensitive to political changes. Despite Trump’s victory, the fall of these meme coins should raise awareness of a possible weakness in the appeal of these meme coins and the fact that part of their liquidity could be diverted to them.
In fact, many investors appear to be shifting their funds to Bitcoin and other altcoins as the flagship cryptocurrency has reached new highs, sparking hopes of a new bull market.
Lose more than 25% of market capitalization
Despite the ambient euphoria Donald Trump’s electoral victory Trump-themed memecoins failed to maintain their earlier gains on Wednesday, and some fell by more than 50% in the first hours after the results.
These tokens, which had increased before the elections, experienced sharp declines, with some lose more than 25% in market capitalization just one day after his victory. Memecoins like TRUMP, MAGA, and TREMP were among the biggest losers, highlighting the typical volatility of these event-driven assets.
Trump-Themed Memecoins Drop Over 50% After Election Rally: Is a Recovery Possible?https://t.co/qSXjNg02v1
– FX Leaders (@FXLeadersCom) November 7, 2024
Trump-themed coins have fallen since Donald Trump’s election victory, with the price of several tokens falling. MAGA, the largest Trump-themed coin by market cap, is down 24.26% in the past 24 hours, changing hands at $1.97 at press time, while its market capitalization increased from $212 million on November 6 to $87 million. Another major token, MAGA HAT, inspired by Trump’s iconic red hat, also fell by 32.22%, with its market capitalization falling to $38 million.
The other big loser was Dark MAGA, which exploded on November 5, then fell 20% from the pre-election level to $0.0048, wiping out more than $2.6 million in market capitalization.
This happens at just the right time, just like every other meme coin follows a strong sell-off after a single peak moment. Event-driven tokens, such as PoliFi coins, are highly volatile and tied to political events that tend to move quickly and can make them vulnerable to dramatic changes in value.
Teuta Franjkovic
Teuta is a seasoned writer and editor with over 15 years of experience in the macroeconomics, technology, and cryptocurrency and blockchain industries. Starting her career in 2005 as a lifestyle writer for Cosmopolitan, she expanded to covering business and economics for several reputable publications like Forbes and Bloomberg. Influenced by the likes of Don and Alex Tapscott and Laura Shin, Teuta embraced the blockchain revolution, believing cryptography to be one of humanity’s most crucial inventions. His involvement in fintech began in 2014, focusing on crypto, blockchain, NFTs and Web3. Known for her excellent teamwork and communication skills, Teuta holds a dual master’s degree in political science and law.
Disclaimer: Content presented may include the author’s personal opinion and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or publication assumes no responsibility for your personal financial loss.
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