Diversification is one of the oldest tricks in the book when it comes to reducing investment risks. By maintaining a well-balanced portfolio that comprises a diverse set of assets from different classes and with different risk profiles, one can ensure that market fluctuations won’t lead to irreparable losses.
Diversifying within each asset category is also highly recommended, especially when navigating highly volatile markets such as crypto. This prompts savvy crypto investors to constantly scan the market for promising coins and tokens that could support their portfolio diversification efforts and help them improve their outcomes.
So, when President Trump launched his official meme coin back in January, plenty of investors and traders naturally wanted to know how to purchase Trump coin and wondered whether they should add it to their portfolios or not. A cryptocurrency backed by such a prominent figure was sure to draw the attention of the entire industry. 
Many jumped on the opportunity and purchased the asset right away, hoping for quick gains. Others were more cautious and patiently waited to learn more information and see how the token would evolve.
As the Trump token continues to attract interest in the crypto market, you might become tempted to invest in it, but is the meme coin a worthwhile addition to your crypto portfolio?
What we know so far
The Trump meme coin, with the ticker symbol $TRUMP, was launched on January 17, just a few days before the Republican leader started his second term as the President of the United States. Developed on the Soalan blockchain by two Trump-owned companies, CIC Digital LLC and Fight Fight Fight LLC, the meme coin comes with a limited supply of 1 billion tokens. The first 200 coins were released into circulation upon launch, while the other 800 tokens are held by the two developing companies, with plans for a gradual issuance over the next three years.
Following her husband’s lead, First Lady Melania Trump launched her own meme coin, $MELANIA, a couple of days later. The timing of the releases, in conjunction with Trump’s inauguration, was opportune, ensuring a dramatic and highly debated entry into the crypto space for the Trump family.
The hype certainly paid off, causing the Trump coin to jump from $7 to a record $75 in less than 24 hours, reaching a market cap of $14.5 billion. The asset eventually dipped and lost most of its value, trading at $16.29 at the time of writing.
From TRUMP’s short price history, we can conclude that the token behaved like any other meme coin, with its price fluctuations driven by market sentiment and not by intrinsic features or usability. The coin soared when interest was high and plummeted when the frenzy died down.
Regarding its investment potential, according to the disclaimer posted on the coin’s official website, TRUMP was not designed to serve as an investment instrument or a security. This suggests that the meme coin is more of a cultural symbol than a real asset with practical applicability and shouldn’t be regarded as a competitor to Bitcoin, Ethereum, or other digital currencies.
Since functionality is not the coin’s purpose or strong suit, the only reason why people would buy the token is if they want to show their support for President-elect Donal Trump. However, this might also be a sensible topic, as the official disclaimer mentions that TRUMP is not political and is not associated with any government agency.
Potential advantages
Just because Trump coin is being marketed as a meme coin – a crypto subset known to lack intrinsic value – and comes with lengthy disclaimers that should discourage people from looking at it as an investment doesn’t mean it’s not going to end up in investors’ portfolios. People have put their money into far less appealing products, so $TRUMP, with its powerful branding, is bound to become a tempting asset.
The most obvious incentive for purchasing TRUMP is the large and loyal base of Trump supporters. Since meme coins thrive on community engagement, the support that Trump receives from his fans might spill onto the asset, driving demand for it and increasing its value.
Another reason why the Trump coin could become a potentially rewarding investment is the limited supply. With only 1 billion coins created, this scarcity might lead to significant price appreciation for the token if demand grows.
The coin’s technical characteristics could also favor its long-term growth as the asset is based on the Solana blockchain and, therefore, benefits from the network’s low fees and fast transaction speeds.
The novelty factor is not to be neglected. With Trump coin being a one-of-a-kind token and a newcomer to the crypto space, its uniqueness could attract an increasing number of investors in the future.
The risks
One of the biggest risks associated with TRUMP is its volatile nature. The coin’s association with such a high-profile individual like Donald Trump can be a double-edged sword. Apart from being a meme coin, which are extremely unstable by default, the Trump token also carries political connotations. That can make it even more unpredictable than other meme coins.
One should not ignore that Trump is a highly controversial figure, and his policies and decisions can trigger all sorts of reactions that might negatively impact the crypto he endorses. 
As a subject of intense speculation, trying to predict the future price of TRUMP is literally impossible, giving traders and investors little hard data on which they can base their trading decisions.
Bottom line
Like all other meme coins, TRUMP comes with both pros and cons, so while it can be a rewarding investment, it’s just as likely to lead to losses. This calls for caution and adequate research before taking the leap. Ultimately, choosing which assets you invest in is a very personal decision that depends on your specific objectives, the skills you possess, your risk tolerance, and, obviously, your budget.
