Rumors of potential tax changes for cryptocurrency gains are spreading rapidly, driven by the sudden success of Official Trump (TRUMP), a memecoin tied to US President-elect Donald Trump.
The Solana-based token has quickly outpaced well-known memecoins like Dogecoin, Shiba Inu (SHIB), and Pepe. According to CoinGecko, TRUMP now boasts a fully diluted valuation (FDV) of $71 billion, becoming the 15th-largest cryptocurrency by market cap in just under 48 hours.
Currently, the US classifies cryptocurrency as property, meaning any sale, trade, or disposal is subject to capital gains tax.
Tax rates for short-term gains on assets held less than a year range from 10% to 37%, depending on income. Long-term gains, for assets held over a year, are taxed at 0% to 20%, based on an individual’s earnings.
Could TRUMP Token Drive Crypto Tax Reform?
The remarkable rise of the TRUMP token has sparked conversations about its potential influence on US tax policy. Investors and crypto enthusiasts speculate that the token’s popularity might prompt tax changes favorable to cryptocurrency holders.
Mike Alfred, founder of Alpine Fox LP and a crypto investor, noted, “With a significant portion of Trump’s wealth now tied to crypto, there’s a good chance we’ll see significant tax reforms, perhaps even the elimination of federal income taxes on crypto gains, within a year.”
Pseudonymous trader Gammichan expressed a similar view, suggesting Trump’s financial interest in the token could lead to sweeping changes.
Caitlin Long, CEO of Custodia Bank, also weighed in, stating, “Trump’s involvement in crypto now provides a strong incentive for him to push for tax reform. A president-elect promoting a memecoin during inauguration weekend was beyond anyone’s expectations.”
TRUMP Token’s Explosive Growth
Launched on January 17, just days ahead of Trump’s inauguration, the TRUMP token has taken the crypto world by storm. It surged by 610% overnight, trading at $68 as of now.
“The TRUMP launch, which reached $72 billion FDV, has drawn liquidity away from other altcoins,” said Daan Crypto, a pseudonymous trader. “Investors are offloading other assets to jump into TRUMP. The weekend timing and limited market liquidity amplified the effect.”
More than 80% of TRUMP’s supply is held by CIC Digital and Fight Fight Fight, both linked to Trump’s business interests. These holdings are locked in a three-year vesting schedule, ensuring they can’t be sold immediately.
With its unprecedented rise and potential policy implications, TRUMP has quickly become the focal point of discussions across the crypto community. Whether its success will translate into tax reform remains to be seen, but it’s clear that this memecoin has captured the attention of investors and policymakers alike.
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