The company behind Donald Trump’s new social media platform is already making massive stock market gains on Friday, despite a lack of financial results and even a live product.
Trading in shares of Digital World Acquisition Corp (DWAC) had to be halted 12 times in the morning because a bombardment of activity caused its value to fluctuate, at least in part thanks to the Reddit investment forum WallStreetBets.
Users of the platform have celebrated wins of up to $ 40,000 and lamented losses of up to $ 60,500.
DWAC is a special purpose acquisition company, also known as a blank check company. These companies go public in order to raise funds to acquire a private company, which would then also become listed on the stock exchange while avoiding the long process of public offering.
DWAC saw its market capitalization increase 300% to $ 1.5 billion after it announced on Thursday its merger with Trump Media & Technology Group, Donald Trump’s latest company.
The ex-president’s new venture has no revenue or a tested business plan, but has raised nearly $ 300 million in cash from investors. This will be the launch pad for his social media site, Truth Social.
On the Trump Media & Technology Group website, the company describes its goal of “creating media might to compete with the liberal media consortium and fight the big tech companies in Silicon Valley.”
WallStreetBets, which describes itself as “like 4chan found a Bloomberg terminal”, is at least partially responsible for the volatile activity in DWAC shares on Friday
Trump is president of his new media company, Trump Media & Technology Group, which aims to disrupt Netflix, Amazon, Google and Facebook, among other tech giants
It aims to disrupt a wide range of media businesses, including Facebook, Amazon, Apple, Netflix, and Google.
Along with his social media site, Trump is also aiming to launch an on-demand streaming service called TMTG + which promises to provide “no-wake entertainment.”
A 22-page publicly available presentation on the company’s website explains why she claims the circumstances are favorable for her brand, without explaining how she intends to achieve these ambitious goals.
That didn’t deter traders on Friday morning, however, who have pushed the stock price up 1,200% since Wednesday.
It rose 138.5% to 108.52 today after hitting a high of $ 175. It closed at a high stock price of $ 94.20
Trump’s social media company Truth Social set to launch on a large scale in early 2022
Its recent exchanges are reminiscent of the meme market frenzy earlier this year, Reuters reports, when an army of retail investors coordinated on online forums to generate shares of GameStop, AMC Entertainment and other shares. .
And similarly to this situation, Reddit’s WallStreetBets community was filled with posts about DWAC activity.
Millions of individual traders post their wins and losses on the site, along with memes expressing their joy or frustration with current market situations.
In the community bio, he describes himself as “Like 4chan found a Bloomberg terminal.”
From last night to this morning, users celebrated their financial gains from trading DWAC shares, while others posted losses and expressed fears that they might not be able to make any money.
L’accord de fusion de Trump Media & Technology Group
Trump Media & Technology Group will merge with Digital World Acquisitions Corps to launch social media and video streaming services tailored to conservatives and supporters of former President Donald Trump.
DWAC is a Miami-based special purpose acquisition company with a $ 293 million trust to fund the launch of TMTG as a publicly traded company.
TMTG is expected to have an initial value of $ 875 million, with a potential earn-out of $ 825 million, for a total of $ 1.7 billion.
Several successful Reddit users have expressed their gratitude to the former president.
Others also referred to a right-wing meme line, “Let’s Go Brandon”, which was designed to mock President Joe Biden after a reporter at a NASCAR race misheard the crowd chanting “F ** k Joe Biden ”for the innocent phrase.
“Thank you Donnie, thank you Brandon, but most of all, thank you Stop Losses,” wrote one user with a photo of his profits.
Another user pointed to Trump’s infamous ‘pee tape’ rumors first introduced in the Steele file in 2016.
“Introducing Daddy Trump’s Golden Showers: 3k-> 13k GAINZ,” they wrote with an image of a 359% increase in their DWAC value.
One person, however, posted a screenshot that appears to show they lost around £ 44,000, or around $ 60,500 in USD.
Others have posted memes expressing their anger at the number of times DWAC shares have been halted.
In comments under a single meme, users accused DWAC and trading platforms of “killing their progress” and acting “dumb”.
“It’s like when you were a kid and you got an unexpected amount of money and your parents took it and said ‘We’re going to keep this safe for you,’ one user wrote.
Members of Reddit’s WallStreetBets forum who were able to capitalize on the DWAC celebrated on Friday, many citing Trump and Biden memes while doing so
WallStreetBets founder Jamie Rogozinski did not immediately return a request for comment.
Truth Social got off to a rough start this week when its beta site was hacked hours after its announcement.
Tech journalists were able to find the site, although its URL is not yet public, and create fictitious accounts representing Trump and Mike Pence.
Trump, who is chairman of the Trump Media & Technology Group, had announced that the site would launch in early 2022.
The public URL was quickly taken offline, and fake accounts were quickly banned.
Additionally, pranksters created a fake Trump account and used it to post the meme image of “pig poop balls,” according to Washington Post reporter Drew Harwell.
The TRUTH Social app is currently available for pre-order from the Apple App Store, with plans to launch a beta for testers in November.
The ex-president is no doubt hoping this company will do better than its latest foray into owning a publicly traded company.
Trump Entertainment Resorts, his casino company, has lost millions of dollars in more than a decade and has filed for bankruptcy several times.
While his shareholders suffered massive losses, Trump himself walked away with $ 82 million over that period, according to Fortune magazine.