Trump Media to Raise $2.5 Billion to Invest in Bitcoin

Trump Media aims to raise $2.5 billion to invest in Bitcoin, planning to create a ‘Bitcoin treasury’. The funds will come from stock sales and convertible notes. CEO Devin Nunes calls the move a step towards financial freedom. The company faces scrutiny from lawmakers while navigating its evolving crypto strategy.

In a notable move, Trump Media and Technology Group announced plans to raise $2.5 billion to bolster its investments in Bitcoin. This initiative aims to diversify the company’s revenue streams as it ventures further into the financial sphere. Specifically, the funds will be generated through a combination of selling $1.5 billion in stock and $1 billion in convertible notes, priced at a 35 percent premium.

The new capital will help the company establish what they refer to as a “Bitcoin treasury,” a term reflecting its intention to hold Bitcoin on its balance sheet alongside existing cash and investments, which totaled $759 million at the end of Q1. To ensure the security of these holdings, Trump Media will partner with crypto platforms like Anchorage Digital and Crypto.com.

Devin Nunes, CEO of Trump Media, expressed enthusiasm about the company’s direction, stating that Bitcoin is viewed as “an apex instrument of financial freedom.” He hailed the investment as a significant advancement toward acquiring assets that align with the “America First principles” that underpin Trump’s vision.

However, shares of Truth Social, the platform tied to Trump Media, dipped 6 percent early in trading after the announcement. The firm is actively exploring opportunities for mergers and acquisitions to strengthen its foray into the financial services sector. Last month, the company even finalized a binding agreement to introduce retail investment products, such as cryptocurrency and ETFs that echo Trump’s policies.

For the Trump family, historically known for its real estate ventures and golf clubs, the engagement with cryptocurrencies is a relatively new endeavor but has quickly yielded substantial financial returns. Their involvement has expanded to include Trump non-fungible tokens (NFTs), a meme coin, and even a share in a newly established Bitcoin producer known as American Bitcoin.

Still, this push into the cryptocurrency space hasn’t gone unnoticed by regulators and lawmakers. For example, Senator Elizabeth Warren has raised concerns regarding the oversight of Trump Media’s planned ETFs following her inquiries directed toward the U.S. securities regulators. Interestingly, despite previously deeming cryptocurrencies as “not money” due to their volatility, Trump seems to have softened his stance, especially after being promised significant financial backing from crypto investors during a recent campaign event at Mar-a-Lago.

Last week, in what some critics labeled a questionable mixing of personal and public interests, Trump hosted top investors from another crypto venture, the $Trump meme coin, for an exclusive dinner at his golf club in northern Virginia.

Trump Media’s initiative to raise $2.5 billion for Bitcoin investment marks a significant shift for the company as it seeks to diversify its business model. The partnership with leading crypto platforms for treasury security and the introduction of retail investment products suggest a deepening engagement with the financial sector. However, regulatory scrutiny looms as the company’s crypto ambitions continue to unfold amidst mixed public receptions.

Original Source: www.aljazeera.com