Trump Media & Technology Group Corp. (NASDAQ:DJT), the parent company of Truth Social, faced a 15% decline on Monday following the registration of shares, including those linked to warrants, signaling a potential capitalization move by insiders, including former President Donald Trump.
Market Reaction and Stock Performance
Shares of Trump Media plummeted to $27.83, marking the lowest level since January, amidst a continued two-week slump. The company’s warrants also experienced a decline of 6.9% to $12.75, contributing to a significant reduction in market value since its March debut.
Implications for Former President and Insiders
The registration of shares and warrants has impacted the potential windfall for former President Trump, decreasing from over $5 billion to $2.3 billion. However, if the stock can maintain a threshold above $17.50, Trump and insiders stand to gain an additional 40 million shares, valued at approximately $1.2 billion.
Legal Battles and Uncertain Future
Trump Media faces legal challenges, including a lawsuit from co-founders alleging attempts to dilute their stakes, and a criminal trial for Trump himself in Manhattan. These legal hurdles, combined with regulatory scrutiny and market volatility, cast uncertainty over the company’s future trajectory.
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