Trump Media Faces Heavy Losses as Bitcoin Holdings Plunge in Market Downturn

Trump Media and Technology Group, the operator behind Donald Trump’s social network Truth Social, has suffered significant losses exceeding $400 million as the value of its Bitcoin holdings nosedived during a widespread cryptocurrency market selloff. The company, which held more than 11,542 Bitcoin at the end of September, purchased the digital assets for nearly $1.37 billion over the summer. As of recently, these holdings have declined in value to just over $950 million, marking a drop of more than 30 percent.

The price of Bitcoin has tumbled sharply, reaching as low as $82,070, a five percent fall within a single day and more than a third below its October peak of over $125,000. The global cryptocurrency market has seen its value shrink by approximately $1.5 trillion since October, largely due to amplified selloffs in technology shares and digital assets.

Shares in Trump Media have registered historic lows this week, trading at just above $10 and reflecting a 70 percent decline since the start of the year. The share price has fallen 35 percent since late October, mirroring broader downturns in United States markets. The Trump family retains ownership of approximately half of the company, with Donald Trump’s stake held through a trust managed by his son, Donald Jr. After surging to an estimated valuation of over $10 billion in March 2024 following a public offering, Trump Media is now valued at around $2.9 billion.

To diversify revenue streams and pursue what it calls financial freedom, the business adopted a so-called Bitcoin Treasury strategy, amassing large reserves of cryptocurrency. In July, Chief Executive Devin Nunes stated the company had acquired $2 billion in Bitcoin both as a hedge against discrimination by financial institutions and to provide financial security. Currently, just under $500 million of Trump Media’s Bitcoin is pledged as collateral for convertible notes, a particular form of company debt.

Recent financial statements indicate a net loss of $54.8 million for the three-month period ending September, preceding the latest volatility in cryptocurrency markets. Despite negative headlines, the company claims it is generating notable income from its unique approach to Bitcoin. Trump Media also maintains a position in Cronos, another cryptocurrency, reportedly worth around $146 million at the end of September; this holding has since suffered a nearly fifty percent decline in value. The organisation has since branched out into financial services, trading, and a streaming platform that features conservative media channels.

The unfolding situation underscores the risky nature of heavy exposure to volatile digital assets and reflects broader turbulence across the technology and financial sectors. Investors and market observers await further developments as Trump Media navigates these challenging circumstances.