The president’s promotion of a speculative digital coin left some crypto investors feeling blindsided, while others saw it as a gimmick that undermined the industry’s credibility.
Dressed in ball gowns, tuxedos and “Make Bitcoin Great Again” baseball caps, a crowd of some of the country’s most powerful cryptocurrency executives gathered a few blocks from the White House for a lavish party three days before President Trump’s inauguration, toasting an incoming administration that had vowed to promote the industry’s interests.
Even Snoop Dogg joined the festivities, offering a rendition of “Don’t Stop Believin.’”
But the crypto millionaires and billionaires were caught off guard by what happened next.
At 9 p.m. on Jan. 17, with the festivities in full swing, Mr. Trump announced on social media that he was launching a new cryptocurrency — a so-called memecoin known simply as $Trump.
The surprise disclosure raised fresh ethics and legal concerns about the ways in which Mr. Trump continues to cash in on his power and fame, in this case by marketing a digital asset in an inherently volatile and speculative market to millions of his followers.
And it set off a wave of criticism from inside the industry that he says he wants to champion.
Crypto executives criticized the move as a cash grab, saying that Mr. Trump had undercut the industry’s credibility at the very moment when proponents were seeking a more prominent place for digital currencies in mainstream finance and business.
His venture, they said, created a brief and highly publicized bubble that partly deflated within a few days even as Mr. Trump’s family and its business partners collected millions of dollars from fees on purchases and sales of the coin.