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The cryptocurrency market faced a surprise on Jan. 18 when the “Official Trump” (TRUMP) memecoin, backed by President-elect Donald Trump, was launched without prior notice. The announcement came via Trump’s social media accounts, directing users to purchase the Solana token using a specified centralized intermediary and providing the contract address.

The memecoin launch sparked a rally in Solana’s (SOL) native token, pushing it to an all-time high of $270. This surge raised questions among traders about whether SOL’s current $120 billion market capitalization is sustainable and its implications for Ethereum (ETH), Solana’s main competitor. Ethereum had previously been perceived as Trump’s favorite due to its allocation within World Liberty Financial, a project closely associated with Trump, but the decision to launch Official Trump on the Solana network has raised eyebrows.

Ether/USD (left) vs. SOL/USD (right). Source: TradingView / Cointelegraph

Official Trump launch timing puts ‘America first’ 

Adding to the intrigue was the timing of the launch, which coincided with the Trump-honoring "Crypto Ball,” a high-profile event that brought together industry leaders such as Michael Saylor of MicroStrategy, Coinbase CEO Brian Armstrong, the Winklevoss twins of Gemini, and David Sacks, Trump’s crypto and artificial intelligence adviser. The sold-out event took place just a few blocks from the White House in Washington, D.C.

Despite the competitive memecoin market, the “Official Trump” (TRUMP) token quickly reached a $6.9 billion market capitalization. It was immediately listed on major exchanges, including Bybit, Bitget, and KuCoin. The memecoin launched with 200 million tokens in circulation and a total supply of up to 1 billion, with 80% allocated to the issuers.

TRUMP token proposed allocation and distribution. Source: GetTrumpMemes

Issuers reportedly deposited 44.4 million TRUMP tokens into single-sided liquidity pools, meaning no direct pairing with assets like stablecoins. The decentralized exchange Meteora (DEX) was chosen to manage the automated market-making (AMM) process alongside Jupiter DEX. The two largest liquidity pools were TRUMP-USDC, with a total value locked (TVL) of $483 million, and TRUMP-SOL, holding $67 million.

Currently trading at $24.60, the “Official Trump” (TRUMP) token is ranked as the 28th largest cryptocurrency by market capitalization, with trading volumes exceeding $7 billion across decentralized and centralized exchanges. For comparison, TRUMP's trading volume has surpassed Dogecoin (DOGE), the oldest memecoin and a sector leader with a $58 billion market cap. As a result, Solana’s decentralized platforms, such as Meteora and Raydium, saw significant benefits from the TRUMP token launch.

Official Trump memecoin solidifies Solana’s dominance in crypto and DeFi

The memecoin market overall experienced a negative impact as traders shifted their focus to the President-elect’s token. More than 200,000 users purchased “Official Trump” (TRUMP) directly through its official app, Moonshot, which facilitated nearly $400 million in trading volume. In contrast, Dogecoin dropped 6%, Shiba Inu (SHIB) fell 7.5%, PEPE declined by 10.5%, and Dogwifhat (WIF) saw an 8% decrease.

For Ether holders, the event posed a double challenge. First, it strengthened Solana’s position as the go-to ecosystem for token launches. Second, it diminished expectations that the Trump administration might favor Ethereum, despite Trump’s previous connections to the Ethereum-based World Liberty Finance project.

Whether the “Official Trump” (TRUMP) token can maintain its price above $20 remains uncertain. Furthermore, for SOL price to break through $300, the Solana network must significantly expand its market share in terms of deposits and institutional adoption. This growth is also contingent on the approval of a Solana spot exchange-traded fund (ETF) by the US Securities and Exchange Commission, which remains a key catalyst for future gains.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.