Aniket PujariAmerican Bitcoin Corp. stock price tumbled 50% on Tuesday after previously locked-up shares—linked to the company co-founded by Eric Trump, son of U.S. President Donald Trump—became eligible for trading.
The stock plunged up to 50% within the first half hour of the session, triggering several trading halts, and ultimately ended the day down 39% at $2.19.
The bitcoin mining stock has been under pressure as it has descended 55.49% in last one month and 61% in six months.
What’s behind the plunge?
According to a post by the company on X, shares issued through a private placement prior to American Bitcoin’s merger with Gryphon Digital Mining Inc. were released for trading on Tuesday.
The end of a shareholder lock-in period often creates volatility, as retail investors see it as a cue to sell. They worry that early investors, now free to offload their holdings, might book profits, which could put pressure on the stock, according to experts.
“I’m holding all my American Bitcoin shares. I’m 100% committed to leading the industry,” said Eric Trump in a post on X.
Over the past two months, the wider cryptocurrency market has dropped sharply — about 25% for benchmark Bitcoin — but tokens associated with the Trump family have fallen much more dramatically.
World Liberty Financial — co-founded by Donald Trump and his sons — has seen its WLFI token drop 51% from its early-September peak, a steeper slide than both Bitcoin and a broader basket of smaller cryptocurrencies. Alt5 Sigma, another venture backed by the Trump sons, has fallen roughly 75% amid mounting legal issues.
Meanwhile, memecoins themed around the president and former First Lady Melania have crashed about 90% and 99% from their January highs. American Bitcoin, co-founded by Eric Trump, has also slumped 75% following Tuesday’s sharp decline.
(With inputs from Bloomberg)
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.
