The cryptocurrency market witnessed a dramatic and symbolic collapse this week, centred around ventures linked to the Trump family. The most striking event was the instantaneous crash of American Bitcoin Corp, a crypto miner co-founded by Eric Trump.
The Spectacular Crash of American Bitcoin Corp
The sell-off on Tuesday was swift and severe. Trading on Wall Street had barely begun when American Bitcoin Corp's shares started to plummet. At 9:31 AM, just one minute after the opening bell, the stock was down 33%. The bleeding accelerated rapidly. Within five minutes, losses expanded to 42%. By 9:56 AM, the company's value had been more than halved, with shares down over 50%.
This spectacular crash made American Bitcoin Corp the poster child for a dual crisis: the broader crypto market downturn in late 2025 and the specific collapse of numerous digital currency projects promoted by the Trump family over the past year.
A Broader Pattern of Trump-Linked Crypto Losses
The plunge at American Bitcoin Corp is not an isolated incident. While major cryptocurrencies like Bitcoin have fallen roughly 25% in the past two months, assets tied to the Trump family have experienced far steeper declines.
World Liberty Financial, co-founded by former President Donald Trump and his sons, has seen its WLFI token drop 51% from its early September peak. This fall is significantly worse than the performance of Bitcoin or an index of smaller digital tokens.
Alt5 Sigma, another company promoted by Trump's sons, has plunged approximately 75% as it grapples with escalating legal challenges.
The situation is even more dire for meme coins named after the former president and his wife. The Trump and Melania-themed tokens have cratered around 90% and 99% respectively from their record highs in January. Following Tuesday's massive drop, American Bitcoin Corp is now down 75% overall, though it saw a slight 11% rebound in US premarket trading on Wednesday.
From "Trump Premium" to "Trump Drag": Market and Image Consequences
These severe losses have eroded the substantial crypto wealth the first family accumulated earlier in the year. More importantly, they carry significant implications for both the digital asset industry and the former president's public standing.
During the initial months of his second term, Trump's endorsement acted as a powerful catalyst, boosting a wide array of crypto tokens and framing Bitcoin's price as a barometer of his political success. However, that dynamic has sharply reversed.
What was once seen as a "Trump premium" has abruptly transformed into a "Trump drag." This shift has removed a key pillar of support for these crypto assets and starkly illustrates how quickly confidence can evaporate in speculative markets—and even in the figurehead associated with them.
Hilary Allen, a law professor at American University’s Washington College of Law, analysed the situation. "The Trump presidency has been a double-edged sword for legitimacy," Allen stated. "Trump started launching his own crypto projects, many of which lost value quickly. If the goal was to achieve legitimacy through the Trump family, that’s not helped."
In response to the crash, Eric Trump took to social media platform X on Tuesday. He attributed American Bitcoin's poor performance to the conclusion of a lockup period for its shares, dismissing any notion of broader weakness. "Our fundamentals are virtually unmatched," he wrote. "I’m 100% committed to leading the industry."
Requests for comment from World Liberty Financial and the firm behind the "Fight Fight Fight" Trump memecoin were not immediately answered.
While the volatility in Trump-associated assets is pronounced, it is not unprecedented for the notoriously turbulent crypto sector. Digital tokens have historically experienced severe drops before recovering. In a contrasting move on Tuesday, even as American Bitcoin Corp struggled, the original cryptocurrency, Bitcoin, enjoyed one of its best days in recent weeks, climbing approximately 6%.
