Donald Trump's empire continues to expand its footprint in the crypto universe. Trump Media has just filed with the SEC two new exchange-traded funds focused on major cryptocurrencies: a Bitcoin-Ether ETF and a Cronos ETF. This offensive comes at a time when the market is going through a period of marked turbulence.
In brief
- Trump Media has filed two crypto ETF applications with the SEC covering Bitcoin, Ether and Cronos.
- The first fund will combine BTC and ETH with staking rewards on Ethereum.
- The second ETF will focus exclusively on Crypto.com's CRO token with yield generation.
- These products will be developed in partnership with Crypto.com, which will provide custody and staking.
A double offensive on the regulated crypto market
Trump Media & Technology Group on Friday formalized the filing of two exchange-traded funds with the U.S. Securities and Exchange Commission.
The Truth Social Funds subsidiary is leading this initiative which aims to offer the “Truth Social Bitcoin and Ether ETF” as well as the “Truth Social Cronos Yield Maximizer ETF”. Applications remain subject to review regulators before being placed on the market.
The first product will replicate the combined performance of bitcoin and Ether, the two giants of the crypto market by capitalization. The originality lies in the integration of staking rewards generated by Ethereum, thus offering a passive return to investors.
The second fund focuses exclusively on CRO, the native token of the Cronos blockchain developed by Crypto.com.
“ We plan to provide an investment platform covering multiple aspects of digital and crypto investing said Steve Neamtz, president of Yorkville America Equities.
The New York company will act as investment advisor for these two funds. Each product would have a management fee of 0.95%, a standard rate for this type of instrument.
Crypto.com will play a central role in the architecture of these ETFs. The platform will provide asset custody services, liquidity and staking operations if the authorities give the green light. Investors will access the products through Foris Capital US LLC, the exchange's affiliated broker-dealer.
A bold bet in a market under pressure
This crypto offensive is part of a broader strategy by Trump Media to invest in the blockchain ecosystem.
Last September, the company had already reached an agreement with Crypto.com to create a joint treasury entity. The operation included the initial purchase of 684.4 million CRO tokens for approximately $105 million. The conglomerate also announced a crypto airdrop intended for its shareholders in January, thus strengthening its foothold in Web3.
The timing of these filings nevertheless raises questions. Bitcoin spot ETFs are going through a turbulent zone with four straight weeks of net outflows. The past week saw $360 million leave these products, according to SoSoValue data. The largest withdrawals reached 817.87 million on January 29 and 544.94 million on February 4.
Despite this difficult context, some positive signals are emerging. Recent flows show inflows of $167 million over three days in early February, nearly erasing the previous week's outflows. This volatility of flows reflects the hesitation of institutional investors in the face of macroeconomic uncertainties.
Trump Media is methodically building its blockchain empire. ETFs add to Truth Social, community airdrop, and massive investments in CRO. This multi-faceted strategy could create a closed ecosystem where each initiative reinforces the others. It remains to be seen whether the SEC will validate these products and whether investors will adhere to them in a still fragile crypto market.
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