Donald Trump’s new social media platform, Truth Social, made a dazzling entry into the stock market, rising more than 30% on its first day of trading. This remarkable achievement was witnessed by the Nasdaq early Tuesday.
Social Truth is part of Trump Media & Technology Group, the parent company, whose shares, identified by the symbol “DJT,” reached a value of more than $65 during mid-morning trading sessions.
The platform’s journey to the stock market began with a merger with Digital World Acquisition Corp. (DWAC), a special purpose vehicle that has been publicly traded since 2021. Trump’s inspiration for creating Truth Social came from his ban from major social media platforms such as Facebook and Twitter, which are now known as X, following the Capitol riots on January 6, 2021. A Despite having been reinstated on these platforms, Trump decided to launch his own social media company.
Trump retains significant control over Truth Social, with approximately 60% ownership, equivalent to nearly 79 million shares. At current trading levels, this stake is valued at more than $5 billion. Along with this success, however, Trump faces challenges, including a $454 million fraud fine and a fundraising shortfall as he prepares for a potential 2024 presidential rematch against Joe Biden.
The merger agreement includes a six-month lock-up period for interested parties before they can sell or transfer shares, except under special circumstances approved by the company’s board of directors. Financial disclosures reveal that Trump Media reported a loss of $49 million in the first nine months of the previous year, with revenue rising to $3.4 million.
It is worth noting that short interest in DWAC shares, which indicates bets on a decline in the share price, represents approximately 11% of shares outstanding. This figure is significantly higher than the average short interest of public companies, which typically ranges between 3% and 4%.
Also read: Tesla introduces free trial of full self-driving (FSD) for customers