The latest meme coin launch by incoming US President Donald Trump seems to have upset the cryptocurrency industry with some speculators labeling it a scam.

One of them, Coffeezilla, a YouTuber popular for exposing shady dealings, has alerted people in view of their concerns that insiders get 80% of this TRUMP coin supply, which means only a tiny fraction is available to the public, which could lead to a market manipulation scenario.

According to Coffeezilla, this structure shows the project as more of a “grift” than a legitimate crypto venture.

Insiders Control The Majority

One major red flag is the concentration of 80% of Trump Coin’s total supply. This disproportionate allocation means that a select group of people, likely developers or influencers involved with the coin, could control the vast majority of the token’s value. For the general public, this spells trouble, as the market could be easily manipulated by those holding most of the tokens.

Red Flags Concerning Transparency

But given the fast-speed promotion, issues of transparency revolve around actual utility. The notion that a meme coin would carry significant weight in the market is unsettling for some analysts, especially when it lacks clear backing or innovation.

While Trump Coin has been verified on the Phantom Wallet, critics argue that this doesn’t necessarily mean it’s a safe investment.

My NEW Official Trump Meme is HERE! It’s time to celebrate everything we stand for: WINNING! Join my very special Trump Community. GET YOUR $TRUMP NOW. Go to https://t.co/GX3ZxT5xyq — Have Fun! pic.twitter.com/flIKYyfBrC

— Donald J. Trump (@realDonaldTrump) January 18, 2025

The project has been criticized for possibly taking advantage of its investors. Coffeezilla’s criticism focuses on the fact that such ventures usually take advantage of the excitement and hype of popular figures such as billionaire Donald Trump, making it easier to encourage people to invest in tokens of little value. Critics argue that this is more about making fast money for the insiders rather than creating long-term value for the crypto community.

Attention given to Trump Coin may also mark a stain to the crypto sector. Projects like this, which focus on short-term gains, often deter new investors from taking the crypto market seriously.

Furthermore, the whole launch may grab the attention of regulators, given that they’re keeping a close eye on meme coins more closely than ever. It seems that this new venture will set off controversy and debate in a digital currency landscape already inflamed by volatility and other related factors.

Coffeezilla is well-known for his stinging exposés of purported cryptocurrency scams, such as Andrew Tate and Hawk Tuah Girl.

Featured image from AP, chart from TradingView

The United States Securities and Exchange Commission (SEC) has charged Nova Labs, the firm behind the open-source Helium Network, with defrauding investors just days before SEC chair Gary Gensler steps down on January 20.

The SEC claims that Helium’s Nova Labs broke several statutes and intends to hold it responsible for violating Sections 5(a), 5(c), and 17(a)(2) of the Securities Act of 1933 and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934. The SEC seeks permanent and conduct-based injunctions, ejection of ill-gotten gains, pre-judgment interest, and civil penalties.

The Nova Labs trial will begin after Gary Gensler’s tenure

The SEC has alleged that since April 2019, Nova Labs has defrauded the public in several ways by making unregistered offers and securities sales. The firm offered and sold electronic devices called “Hotspots” that mined Nova Labs’ crypto assets. Moreover, Nova Labs sold “Discovery Mapping,” a program where users can exchange their private data for Nova Labs’ crypto assets.

Investors are vulnerable to unregistered securities since they can lose layers of protection while transacting. It is very difficult to identify clear money trails or even track an investment if it’s failing. The SEC had previously brought many such lawsuits under Gary’s leadership.

Nova Labs was also charged with issuing materially false and deceptive statements to lure prospective investors. According to the SEC, Nova Labs lied that prominent companies like Lime, Nestlé, and Salesforce are using its wireless network for their operations. However, upon investigation, it was clear that these firms were not relying on this network.

SEC’s new team may close several cases in 2025

Paul Atkins, Trump’s crypto-friendly pick for SEC chair and former agency commissioner, is widely expected to end a crypto crackdown led by President Biden’s Democratic SEC chair, Gary Gensler. However, it is unclear when the Senate will confirm him.

The Security and Exchange Committee leadership is bound to change as Gary Gensler steps down on January 20. With the new pro-crypto chair, discussions are underway about freezing cases that are not fraud-related.

Steps to freeze these actions are expected through policy adjustments that may be more favorable compared to the outgoing regime. Trump, a vocal pro-crypto president, has maintained his support for digital assets and is considering the idea of a Bitcoin reserve.

According to Reuters, the SEC may review its court cases and proceed with only fraud-related cases in the first few days after President-elect Donald Trump assumes office on January 20. It is unclear if the Nova Lab case will continue or will be among the few that will be nixed.

The report suggests that SEC Commissioners Hester Peirce and Mark Uyeda — both Republicans, like Trump — could review the regulator’s rules on the definition of securities and ongoing court cases with crypto firms.

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