The cryptocurrency crash burns the Trump family's wealth: how insiders profit while retail investors lose

When the crypto market moves, not everyone pays the same price. While small investors who bought the TRUMP memecoin at the peak suffered catastrophic losses, founders like the Trump family have implemented sophisticated strategies to limit damage and even profit.

A wealth decline from 7.7 to 6.7 billion: the price of crypto exposure

According to the Bloomberg Billionaires Index, the Trump family’s wealth experienced a significant contraction between early September and the following months. The impressive figure tells a more complex story than a simple wrong bet on prices: it reflects an aggressive diversification into the crypto sector that proved more volatile than expected.

With an overall loss of over $1.1 billion in the crypto market, the family has seen substantial resources evaporate from projects like WLFI (World Liberty Financial), TRUMP memecoin, American Bitcoin Corp, and holdings through Trump Media & Technology Group.

But here’s the key point: while the book value of their assets has plummeted, the family has collected hundreds of millions of dollars in cash from token sale operations. This crucial divide between paper and cash represents the structural advantage insiders have in the crypto market.

Trump Media & Technology Group: $800 million volatilized

Shares of Trump Media & Technology Group, the parent company of Truth Social, hit historic lows, losing over 66% in the past year. The timing of crypto investments has proven disastrous.

From September to January, the value of Trump’s stake in the company dropped by about $800 million. The company’s decision to invest around $2 billion in Bitcoin (buying about 11,500 BTC at an average of $115,000 each) now shows a book loss of about 25%, although the current Bitcoin price is $92.14K with a +1.42% move in the last 24 hours.

Additionally, the company accumulated CRO, a token issued by a Singapore-based crypto exchange. Valued at $147 million at the end of September, it has lost nearly half its value, with CRO now trading at $0.10.

World Liberty Financial: $3 billion paper loss, but $900 million in cash

The family’s central crypto project is a fascinating case study of how insiders protect themselves from market risk.

The WLFI tokens held by the family had a book value of nearly $6 billion at the peak, now reduced to about $3.15 billion. The token went from 26 cents to just 15 cents (currently 0.17 with +0.71% in the last 24 hours). However, this paper decline conceals a more sophisticated strategy.

The family strategically sold a portion of the tokens to Alt5 Sigma Corp., collecting $750 million in cash plus equity participation. The operation provided them with immediate liquidity of about $900 million from WLFI sales ($500 million from Alt5, $400 million from previous placements), regardless of subsequent price fluctuations.

While retail investors of Alt5 saw the stock price collapse by 75%, the Trump family has already pocketed the initial profits. As Jim Angel, a finance professor at Georgetown, states: “Retail investors can only speculate, while the Trump family not only speculates but issues tokens, sells them, and profits from these operations.”

American Bitcoin: over $300 million less, but staying in office legally

Eric Trump and Donald Trump Jr. structured a complex swap operation with Hut 8 Corp., acquiring a majority stake in the newly created American Bitcoin Corp., now listed on Nasdaq.

The ABTC stock price reached $9.31 in early September, when Eric’s (about 7.5% stake) was worth $630 million. Since then, it has fallen over 50%, eroding more than $300 million from the family’s wealth. Anyone who bought ABTC at IPO suffered a 45% loss.

Despite the decline, this operation remains one of the rare examples where the family has crystallized substantial gains from crypto activities, demonstrating favorable timing of the entry point.

TRUMP memecoin: from boom to disaster, but with hidden protections

The TRUMP memecoin has continued its deterioration since its launch during the presidential inauguration weekend, losing an additional 25% since late August. Today, the token is traded at $5.48 with a +0.73% move in the last 24 hours, but this does not erase the disaster for early buyers.

According to Gauntlet, wallets associated with the issuance held 17 million tokens, with another 17 million already on exchanges. In July, an additional 90 million tokens were unlocked. Bloomberg attributes 40% of the total supply to the Trump family.

At current prices, these tokens are worth about $310 million, but the interesting point is that the total value of the family’s position has increased thanks to gradual unlocks: newly unlocked tokens for insiders are worth about $220 million based on Messari data. This means that while the price has fallen by $117 million, the unlocks have actually increased the total value of their position.

The lesson: insiders vs retail in the crypto market

Eric Trump continues to preach optimism, urging investors to “double down during downturns.” He is right historically—Bitcoin has always reached new highs over time—but his advantageous position remains categorically different from the masses.

The real dynamic is this: while retail investors speculate solely on price movements and bear the full volatility, the Trump family has built a structure that allows them to profit through token issuance, strategic sales, revenue rights, and stakes in operating companies, regardless of price fluctuations.

The family’s wealth decline from $7.7 billion to $6.7 billion is real on paper, but the liquidity gained from token placements provides a structural protection that small investors simply do not have. This is the true lesson of the crypto crash of the 2024-2025 season.