The company behind Donald Trump‘s new social media platform is already delivering massive stock market gains on Friday, despite a lack of financial results and even a live product.
Trading on shares of Digital World Acquisition Corp (DWAC) had to be halted 12 times through the morning as a bombardment of activity sent its value into wild fluctuation, at least in part thanks to Reddit investing forum WallStreetBets.
DWAC is a special purpose acquisition company, also known as a blank-check company. These firms go public in order to raise money to acquire a private company, which would then also become publicly traded while side-stepping the lengthy public offering process.
DWAC saw its market cap rise 300 percent to hit $1.5 billion after announcing its merger with Trump Media & Technology Group on Thursday, Donald Trump’s newest venture.
The ex-president’s new firm has no revenue or tested business plan but has raised nearly $300 million in investor cash. It will be the launchpad for his social media site, Truth Social.
On Trump Media & Technology Group’s website, the company outlines its goal to ‘create a media powerhouse to rival the liberal media consortium and fight back against the Big Tech companies of Silicon Valley.’
WallStreetBets, which describes itself as ‘like 4chan found a Bloomberg Terminal,’ is at least partially responsible for DWAC shares’ volatile activity on Friday
Trump is chairman of his new media venture, Trump Media & Technology Group, which is aiming to disrupt Netflix, Amazon, Google and Facebook, among other tech giants
It aims to disrupt a broad swath of media businesses, naming Facebook, Amazon, Apple, Netflix and Google among others.
Alongside his social media site Trump also aims to launch an on-demand streaming service called TMTG+ which promises to provide ‘non-woke entertainment.’
A 22-page presentation publicly available on the company site details why it claims the circumstances are right for its brand, without going into how it intends to see those ambitious goals through.
That did not deter traders as of Friday morning, however, who sent the stock price surging 1,200 percent since Wednesday.
It was last up 138.5 percent at $108.52 today after earlier hitting a high of $175.
Trump’s social media company Truth Social is set for a wide launch in early 2022
Its recent trading was reminiscent of the meme stock frenzy earlier this year, Reuters reports, when an army of retail investors coordinated on online forums to drive shares of GameStop, AMC Entertainment and other stocks.
And similarly to that situation, Reddit’s WallStreetBets community was filled with posts about DWAC’s activity.
Millions of individual traders post their wins and losses to the site, along with memes expressing glee or frustration at current market situations.
In the community bio it describes itself as ‘Like 4chan found a Bloomberg terminal.’
From last night into this morning, users celebrated their financial gains off of trading DWAC shares while others posted losses and expressed fears over missing out on potentially making money.
Trump Media & Technology Group’s merger deal
Trump Media & Technology Group will merge with Digital World Acquisitions Corps to launch a social media and video streaming services tailored for conservatives and supporters of former President Donald Trump.
DWAC is a Miami-based special purpose acquisition company with a $293 million trust to finance TMTG’s launch as a publicly traded company.
TMTG is expected to have an initial value of $875 million, with a potential additional earnout of $825 million, combining to a total $1.7 billion.
Several successful Reddit users expressed gratitude toward the former president.
Others also referenced an alt-right meme phrase, ‘Let’s go Brandon,’ which was designed to mock President Joe Biden after a reporter at a NASCAR race misheard the crowd chanting ‘F**k Joe Biden’ for the innocent phrase.
‘Thanks Donnie, Thanks Brandon, but most of all, Thanks Stop Losses,’ one user wrote along with a picture of their profits.
Another user invoked the infamous Trump ‘pee tape’ rumors first introduced in the Steele Dossier in 2016.
‘Presenting Daddy Trump’s Golden Showers: 3k->13k GAINZ,’ they wrote along with an image of 359 percent rise in their DWAC value.
One person, however, posted a screenshot that appears to show they lost roughly £44,000 – or about $60,500 in USD.
Others posted memes expressing anger at the amount of times trading DWAC shares was halted.
In the comments under one meme, users accused DWAC and trading platforms of ‘killing their progress’ and acting ‘idiotic.’
‘It’s like when you were a kid and came in to an unexpected amount of money and your parents took it and said “We’re gonna keep this safe for you”,’ one user wrote.
Members of Reddit’s WallStreetBets forum who were able to capitalize on DWAC celebrated on Friday, many invoking Trump and Biden memes while doing so
WallStreetBets founder Jamie Rogozinski did not immediately return a request for comment.
Truth Social got off on a rocky start this week when its beta site was hacked hours after it was announced.
Tech reporters were able to find the site, despite its URL not being public yet, and set up mock accounts representing Trump and Mike Pence.
Trump, who is chairman of Trump Media & Technology Group, had announced the site would launch in early 2022.
The public URL was soon taken offline and fake accounts were promptly banned.
Additionally, pranksters made a fake Trump account and used it to post the meme image of ‘pig poop balls,’ according to Washington Post reporter Drew Harwell.
The TRUTH Social app is currently available for pre-order on the Apple App store, with plans to launch a beta version for testers in November.
The ex-president no doubt would hope this venture would go better than his last foray into owning a publicly traded company.
Trump Entertainment Resorts, his casino company, lost millions of dollars over more than a decade and filed for bankruptcy multiple times.
While his shareholders suffered massive losses, Trump himself walked away with $82 million over that time, according to Fortune Magazine.