Trump-themed chest coins are on the rise ahead of US elections

In the niche world of political chest cryptocurrencies, Donald Trump has overtaken Joe Biden, and tokens associated with the former leader have experienced a significant increase in volume and value. As November’s US presidential election approaches and candidates prepare for the first public debate on Thursday, these tokens, which are modules of a branch called “PolitiFi”, are gaining traction.

The market for political chest coins is relatively small, with a total value of around $1 billion, but Trump-related tokens dominate the space. CoinGecko information shows that seven of the top ten political chest coins are based on Trump and carry names such as MAGA and MAGA Border, often referencing the “Make America Great Again” slogan. In contrast, only one large coin, Jeo Boden, has been associated with Leader Biden.

The market value of the MAGA token, which trades under the ticker TRUMP on various exchanges, jumped to $775 million in June, a significant increase from its negligible price at the beginning of the year. The token was launched in late August 2023. Released in March, Jeo Boden reached a peak market cap of $648 million shortly after its launch, but has since fallen to $87 million.

Forrest Przybysz, CEO of Sistine Research and a cryptocurrency trader, stated that chest coins are highly speculative and always develop with public interest, and suggested that Trump’s ability to attract attention makes him an ideal figure for this type of tokens. He predicts that prices and speculation for Trump-based tokens will increase as the election approaches.

According to CoinGecko’s claims, political tokens represent only a small portion of the $46 billion chest coin market, which is a segment of the $2.3 trillion major cryptocurrency market. These tokens mostly appear around election times, taking advantage of the increased interest in political figures.

Despite their growing popularity, the legitimacy of many political chest coins has been questioned, and some investors on social media have expressed concern about potential “rug pulling.” Additionally, these tokens are not widely listed on major centralized exchanges such as NASDAQ:COIN or Binance and are traded primarily in ether or solana pairs on smaller platforms.

National polls show a tight race between Biden and Trump, and the upcoming presidential debate is a crucial event five months before the election on November 5. At Polymarket, a betting site that uses stablecoins, users are betting on a 59% chance that Trump will beat incumbent Biden.

Political tokens attract retail investors with their satirical or humorous branding, leveraging the public profiles of political figures. Yan Liberman from Delphi Digital pointed out that humor is an important success factor for these tokens. Although Trump has not backed any token bearing his name, his criticisms of Democrat-led regulatory efforts have strengthened his position among supporters of these cryptocurrencies.

Ahead of the election, the crypto industry has been actively supporting crypto-friendly candidates with notable contributions such as $2 million in bitcoin donated to Trump’s campaign by Tyler and Cameron Winklevoss, but this federal contribution was returned because it exceeded its limits.

Analysts at Bitfinex have observed that these tokens have become speculative assets in their own right, closely tied to election results. As the political climate grows heavier, the movement of these chest coins is likely to reflect the changing dynamics of the campaign trail.

Reuters contributed to this article.

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