donald trump
The ups and downs of the cryptocurrency market are as unpredictable as they are dangerous. This time one of the most influential and politically powerful families in the world has fallen prey to it. According to foreign media reports, a big bet made by Eric Trump, son of US President Donald Trump, on American Bitcoin has completely backfired. Due to this wrong decision, the Trump family fortune has suffered a huge loss of $ 600 million (i.e. more than Rs 5,700 crore). Let us understand in detail what this whole matter is, how the loss happened and what is its meaning.
What is the whole matter?
American Bitcoin Corp. It was started with a simple idea. That is, a lot of money can be earned from ownership and mining of Bitcoin. But on the contrary, Eric Trump’s co-founded company appears to be in deep trouble. When the Bitcoin market declined and the demand for artificial intelligence increased rapidly, investors preferred miners who could use their infrastructure for AI-focused data centers.
On the other hand, American Bitcoin stuck to its crypto strategy and its shares have fallen by more than 95 percent from their highest level. According to Bloomberg’s calculations, in the last 10 months the market value of Eric Trump’s stake has decreased by more than $600 million i.e. more than Rs 5700 crore. Also, to maintain its listing on Nasdaq, the company had to do a 1-for-15 reverse stock split this week. On Wednesday its share price reached its lowest level ever.
Have investors lost confidence in crypto companies?
This huge loss indicates how quickly investors have lost confidence in crypto-only companies. Now success is not determined by who can create the most Bitcoins, but by who has the ability to make money from their electricity, land and computing infrastructure.
For the Trump family, the troubles with ‘American Bitcoin’ point to how volatile the country’s most prominent family’s digital asset investments can be. Even though President Donald Trump reported crypto earnings of at least $1.4 billion last year in his latest financial report, many ordinary investors have suffered losses. The price of Trump-related tokens and shares of ‘American Bitcoin’ have fallen.
According to Bloomberg’s calculations, Eric Trump holds about 6 percent stake in ‘American Bitcoin’ and is its Chief Strategy Officer. No information has been given about the stake of advisor Donald Trump Jr.
This is how the company started
Interestingly, when the old company of ‘American Bitcoin’ was started, it had said that its strategy would be to build a portfolio of data centers. ‘American Data Centers Inc.’ – which was supported by Eric Trump and Donald Trump Jr. – was bought by Trump-advised investment bank ‘Dominari Holdings Inc.’ Started in February 2025. At that time Eric Trump said that it was “critical to AI infrastructure growth in America”.
But after just one month, the company changed its direction and became ‘Hut 8 Corp.’ Made a deal to acquire mining equipment from a company named, in return for which he had to give an equity stake and an exclusive service agreement.
Subsequently, ‘American Bitcoin’ (new name) was already owned by the public mining company ‘Gryphon Digital Mining Inc.’ A reverse-merger took place with the company and it began trading on Nasdaq in early September. After five trading days, its share price reached its highest level and closed at a high of $139.65 on September 9.
Shift towards AI
As crypto prices fell over the past nine months, investors took advantage of US-based miners who rented out their computing infrastructure to AI. Riot Platforms Inc., Cipher Digital Inc., MARA Holdings Inc. and TeraWulf Inc. – Everyone announced deals to expand in data centers.
This year, their shares have seen an average rise of more than 60 percent, while American Bitcoin has declined by 77 percent. Needham & Co. Analyst John Todaro said in a Bloomberg report that every company included in my coverage is moving towards HPC (High-Performance Compute). But American Bitcoin has stuck to its Bitcoin-mining and depositing strategy. They may not have much choice.
The company’s core assets are its mining rigs and Bitcoin holdings. Electricity, sites, hosting infrastructure and daily mining operations are provided by Hut 8, the majority owner of American Bitcoin, under a special service agreement. This brings most of the AI data-center related options to ‘Hut 8’. The company has emphasized this strategy by rebranding on the basis of power infrastructure and AI data center lease worth billions of dollars. This year the shares of ‘Hut 8’ have increased more than double.
