Trump Media buys $2 billion in bitcoin as it pursues crypto treasury strategy

CBS News

5 days ago

Trump Media and Technology Group, the social media company owned by President Trump, said it has bought about $2 billion in bitcoin and related securities as it remodels itself as an investment firm.
Trump Media, which owns the Truth Social app, announced in May that it planned to raise $2.5 billion to buy bitcoin, with the goal of creating a reserve of the cryptocurrency. The $2 billion bitcoin purchase is part of the company's "bitcoin treasury plan," Trump Media CEO Devin Nunes said in a news release on Monday.
Mr. Trump, the largest investor in Trump Media, has increasingly focused on cryptocurrencies both through his private businesses and his administration. The company's $2 billion bitcoin purchase comes as Trump Media looks to roll out a range investment products, including a plan to sell exchange-traded funds, or ETFs.
The bitcoin purchase will "help ensure our Company's financial freedom, help protect us against discrimination by financial institutions and will create synergies with the utility token we're planning to introduce across the Truth Social ecosphere," Nunes said in a statement.
The company also said it has set aside $300 million for an "options acquisition strategy for bitcoin-related securities." Trump Media said it plans to continue acquiring bitcoin.
Shares of Trump Media rose $1.04, or 5.6%, to $19.71 in Monday morning trading. The stock has declined 42% ths year.
For the first quarter, Trump Media reported revenue of roughly $821,000, up from $770,000 in the year-ago period, a regulatory filing shows. The company reported an operating loss for the quarter of $39.5 million, down from $98.3 million from a year ago.
A crypto treasury strategy involves buying and holding cryptocurrencies, similar to how companies may invest in more traditional assets like bonds to provide them with financial flexibility.
The best-known advocate of this approach is billionaire Michael Saylor, who runs a software company called Strategy (formerly known as MicroStrategy). It owns 607,000 bitcoins – worth more than $72 billion at today's bitcoin price — making it the largest public bitcoin treasury company, according to Bitcointreasuries.net.
Saylor's company uses a variety of strategies, such as selling shares or issuing debt, to keep expanding its bitcoin holdings. As the digital currency's price has soared to more than $118,000, shooting up 74% over the last year alone, Strategy's stock price has followed, surging more than 3,500% since 2020.
That success has also spawned many imitators, while the White House invited him to its Digital Assets Summit earlier this year.
The Trump administration is planning a new U.S. "strategic reserve" of crypto assets. Last week, Mr. Trump signed the GENIUS Act, the first major law governing digital currency.
"For the past five years, the only thing better than Bitcoin is More Bitcoin," Saylor wrote in a July 17 social media post.The Associated Press
contributed to this report.