The crypto market is seeing negative signals for TRUMP as the price continues to decline and the risk of dilution increases. Currently, TRUMP is hovering around $16, with a key support level at $15.
After failing to maintain the $25 resistance level last week, TRUMP price has been restrained by the 21-day moving average (DMA), indicating that selling pressure is dominant. In addition, the $1.5 billion hack on Bybit exchange on Friday has shaken the overall crypto market. However, for TRUMP, the situation is more serious as the meme coin market faces the risk of dilution.
Dilution Pressure and Growing Competition
Recently, the meme coin market has witnessed significant weakness. Part of the reason is that TRUMP has attracted liquidity from other meme coins like Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe (PEPE), reducing the value of these coins. At the same time, the explosion of platforms like pump.fun has created a series of new meme coins, attracting retail money and diluting the value of existing coins.
TRUMP is no exception to this trend. The emergence of new meme coins from celebrities like rapper Ye (formerly Kanye West) with the YZY project is adding pressure. YZY is inspired by TRUMP and will dedicate 70% of its supply to Ye himself. This is a sign that a new trend is forming, where influencers leverage their personal brands to issue meme coins.
With the rise of these coins, capital may continue to flow out of TRUMP, putting pressure on the price. In addition, 80% of the total TRUMP supply currently held by former President Donald Trump will gradually unlock over the next three years, increasing the risk of inflation and negatively impacting the value of this coin.
TRUMP Price May Continue to Fall, But Not Collapse Completely
According to data from TradingView, TRUMP is now down 78% from its all-time high on Binance at $77.24. Meme coins often lose up to 99% of their value from their peak, which shows that the possibility of TRUMP continuing to fall deeply is still very high. A price below $10 is completely possible in the near future.
However, it is undeniable that the Donald Trump brand brings special appeal to this coin. In the context of the US government's increasingly positive attitude towards cryptocurrencies, 2025 could be a boom period for the crypto market. If the government announces a strategic Bitcoin reserve or Congress passes pro-crypto policies, the euphoria could help TRUMP rebound strongly.
However, investing in TRUMP is not for the faint of heart. Investors need to be prepared for strong volatility, with the possibility that the price could fall as much as 90% before recovering. Shorting meme coins like TRUMP is risky, but holding long-term also requires great patience.
Conclusion
TRUMP is facing downward pressure due to the dilution of the meme coin market and the risk of supply inflation. Although it could fall below $10, the support of the Donald Trump brand and the US government's crypto policy could help the coin hold firm. Investors should be cautious before deciding to participate in this market.
