The first crypto president has done a crypto thing.
Donald Trump released a memecoin Friday night. This was arguably the biggest trading spike in cryptocurrency history. Solana infrastructure and apps buckled as they processed $39 billion worth of DEX trades on just Sunday. This was a huge increase over its previous high daily volume of $10 billion.
Some people were quick to see Trump’s memecoin as an opportunity to attract new crypto users, but that is wishful thinking. The token has already fallen 40% since its Sunday peak, and the only indication is that it’s a gambling project.
Still, there was one Trumpcoin development I think could have longer-term implications — an overnight surge in Solana’s stablecoin supply. Blockworks Research reported that the Solana Network housed stablecoins worth $6.1 billion on Friday. Solana had $9.6 Billion in stablecoins yesterday. This is $3.5 billion worth of stablecoins that have increased by 57% in three days.
In order to put things in perspective, Solana has added $3.5 billion worth of stablecoins from the 17th March 2024 up until today. This network squeezed 306 days worth of growth in stablecoins into one long weekend.
Blockworks Research’s data leader Dan Smith explained that the TRUMP and MELANIA tokens, minted by America’s most prominent couple, were paired up with Circle’s USDC. This meant traders would have to purchase them with USDC. USDC, a Solana native coin, was put under tremendous upward pressure. Arbitrageurs therefore likely used stablecoins to buy dollars and sell them for just over $1.
In the past, stablecoins have tended to stick around. The layer-1 has more than $113 billion worth of stablecoins. This is 11 times the supply that Solana had in 2021.
Stables are not only used to provide liquidity for memecoins. They can also be utilized for other real-world things like payments, remittances or even onchain banking. In our anonymous survey, a number of Solana’s founders cited payments and stablecoins as the most underrated sector in their network.
So was the TRUMP memecoin — 80% of which is held by insiders — a shameless cash grab? It’s likely yes. But that doesn’t stop it from having positive effects on Solana.
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