Trump Media will conduct a cryptocurrency token airdrop to shareholders in February

Source: PortaldoBitcoin Original Title: Trump Media will airdrop cryptocurrency tokens to shareholders in February Original Link:

Trump Media plans to airdrop tokens to shareholders

Trump Media and Technology Group plans to airdrop or distribute tokens to shareholders. This Tuesday (20th), the company set a deadline for investors in Truth Social.

This company, associated with former U.S. President, has designated February 2nd as the registration date for its digital token program, aiming to provide investors with a “new type of digital token,” according to a company press release. The company added that it will offer “multiple rewards” to investors in the future.

The company, headquartered in Sarasota, Florida, stated that these tokens do not represent shares of Truth Social or any other company. Trump Media also does not expect these tokens to be transferable, exchangeable for cash, or distributed to shareholders who are not ultimate beneficiaries.

The company recommends shareholders contact their brokers to ensure they are not classified as “beneficial owners opposed,” noting that such classification could delay the process of determining eligibility for distribution. Investors must also hold at least one whole share to qualify, the company added.

Details about the use of tokens revealed by Trump Media are limited, but the plan highlights the company’s efforts to integrate crypto assets into its business, including products like the Truth.Fi fintech brand and Truth Predict prediction markets.

Collaboration with a Major Exchange

Trump Media stated that the tokens will be “minted” through a partnership with a major exchange, which provides infrastructure support on the Cronos blockchain for the company’s prediction market products. The exchange previously announced in August that its digital wallet infrastructure would be integrated into Truth Social.

Trump Media’s stock recently traded at approximately $14.19, up 2.2%. The Cronos (CRO) token fell 5% in the past 24 hours to $0.09.

The announcement noted that Trump Media is adopting Cronos as a “utility token,” planning to allow Truth Social users to purchase subscriptions and services with it. The Tuesday statement indicated that the token plan might include discounts related to Trump Media products.

Trump Media CEO and Chairman Devin Nunes stated that the company plans to use a major exchange’s blockchain in compliance with SEC regulations. Under the Trump administration, the regulatory agency ended its investigation into a certain exchange in March last year.

The parent company of that exchange, Foris DAX, spent $2.8 million on lobbying Congress last year, according to OpenSecrets data. The company also donated resources to political action committees supporting Trump’s re-election campaign, a fact mentioned in a recent letter by Democratic lawmakers.

Wall Street’s Tokenization Trend

As Trump Media takes this step, Wall Street giants including the New York Stock Exchange are preparing to support tokenized securities. However, companies associated with Trump have explicitly stated that the tokens distributed to shareholders are not digital representations of equity.

Under previous leadership of the SEC, companies like a compliance platform have been cautious when creating tokens for their second-layer scaling networks. Since then, the company has indicated that the plan has begun to be considered but has not yet provided a timeline.