- Ark Invest CEO Cathie Wood told Bloomberg her asset management firm wouldn’t invest in President Donald Trump’s memecoin, $TRUMP. She said the firm doesn’t know “of much utility for this coin” and will stick to the big three: Bitcoin, Ethereum, and Solana.
Just days before taking office for the second time, President Donald Trump launched his own crypto memecoin, which trades under the name $TRUMP.
But like other memecoins, $TRUMP had its moment that came and passed. On Jan. 17, Trump introduced the cryptocurrency, which initially soared in value. It briefly reached a market cap of nearly $15 billion, before plummeting to about $9 billion on Tuesday. On Thursday, the market cap had fallen even further to about $7.5 billion.
While Trump fanatics and supporters initially flooded the zone, $TRUMP is following the classic patterns of a memecoin. And it’s why Cathie Wood, CEO of asset management firm ARK Invest, is steering clear.
“We don’t know of much utility for this coin, except that it is a memecoin of President Trump,” Wood told Bloomberg on Wednesday. “We’ve pretty much stayed away from the memecoins.”
Memecoins are digital currencies whose values aren’t connected to financial metrics, but rather to investor sentiment or pop-culture trends (think Haliey Welch, a.k.a. the Hawk Tuah girl). Investments in memecoin tend to be highly volatile, and—if not made carefully—can lead investors to major losses if they don’t know the right time to sell.
Instead, Wood said her firm focuses on the “big three” in cryptocurrency, including Bitcoin, Ethereum, and Solana. Wood has on multiple occasions vocalized her prediction that Bitcoin will hit $1 million by 2030. Bitcoin just hit $100,000 in December 2024.
Ark Invest didn’t immediately respond to Fortune’s request for comment.
But $TRUMP “is part of the memecoin moment,” Wood said of Trump’s new cryptocurrency. It “isn’t going to have any utility.”
Wood also said some people who buy the Trump memecoin are under the impression they’ll get to meet the president if they invest.
“I don’t know if that’s the case or not,” Wood said. “But so far, we don’t know of much utility for this coin.”
Generally speaking, the reaction to $TRUMP has been speculative—even from crypto backers and Trump supporters.
Unsurprisingly, Ro Khanna, the liberal representative from California’s 17th District, called for banning the sale of memecoins by public officials.
“Elected officials must be barred from having meme coins by law,” Khanna posted on X on Sunday. “Meme coins are highly speculative and like gambling must be regulated by the SEC.”
Meanwhile, Nic Carter, founding partner of crypto investment firm Castle Island Ventures and a Trump supporter, also spoke out against the coin.
“It’s absolutely preposterous that he would do this,” Carter told Politico. “They’re plumbing new depths of idiocy with the meme coin launch.”
Representatives for Trump and the Trump administration didn’t immediately respond to Fortune’s request for comment.
Plus, Trump affiliates own an 80% stake in the token. If CIC Digital, an affiliate of the Trump organization, and CIC co-owned Fight Fight Fight LLC decide to sell their 80% stake, it would lead to an influx in Trump’s wealth. This would be all while pulling the rug out from investors.
“In terms of investors, of course there’s a huge red flag,” Leonard Kostovetsky, associate professor of finance at Baruch College’s Zicklin School of Business, told Fortune’s Sasha Rogelberg. “All of these memecoins don’t really have any value beyond just what other people are willing to pay for them. They’re pure bubbles.”
