Connect with us

World News

Shares surge again in Donald Trump-linked social media venture



Donald Trump is launching his social media network TRUTH.

New York, United States:

A new investment vehicle tied to Donald Trump’s budding media venture escalated into a frenzy Friday again, reflecting the former president’s staying power, as well as a stock market increasingly prone to casino-like trends.

Shares of Digital World Acquisition Corp, which is set to merge with Trump’s Media and Technology Group (TMTG) startup, are signaling a tentative trading halt for the second straight day on Friday.

Shares ended at $94.20, more than double its value since Thursday and more than nine times the price on Wednesday afternoon before the venture was announced.

“It’s in effect. Everyone is hoping the next person who comes in is willing to pay more,” said analyst Patrick O’Hare.

While Trump remains a beloved figure for a large minority of the American population, pundits said he may face challenges in building the “media powerhouse” described in the TMTG presentation, which includes plans for social media and streaming services. Huh.

Digital World, which trades under the ticker “DWAC” on the Nasdaq, is a Special Purpose Acquisition Company (SPAC), sometimes called a “blank check” company because it intends to merge with another entity for the sole purpose of has been installed with.

The ventures raised $293 million in an initial public offering in September.

The use of SPACs has increased over the years amid low interest rates, as investors seek higher returns, and to publicly sell shares that provide short cuts. Office-sharing company WeWork on Thursday adopted a strategy to go public.

A joint press release from TMTG and Digital World said the companies plan to launch “Truth Social,” a social media platform nationally, early next year.

The new outlet “will serve in the fight against rival liberal media consortiums and Silicon Valley’s ‘big tech’ companies, who have used their unilateral power to silence voices of protest in America.”

– New Gamestop? –

Trump set the national media agenda with his aggressive use of social media sites such as Twitter and Facebook, a technique that propelled him to the presidency, where he often announced policies with tweets.

But the former president was thrown out of both platforms after inciting supporters for a violent takeover of the US Capitol on January 6 this year, while falsely claiming the election results were fraudulent.

In the wake of those events, Trump’s hotel business lost important deals with the Professional Golf Association, among other groups.

Following the Trump deal, Saba Capital sold most of its shares in the digital world in rebuke to the former president, The New York Times reported.

While Trump has been underestimated before, some commentators said TMTG would face obstacles.

After January 6, the conservative social media site Parlor was cut from platforms run by Amazon, Apple and Google because of concerns over how it was handling content that incites violence.

Rich Greenfield, partner at research firm Lightshade Ventures, said TMTG may also be “out of the box” because it isn’t initially focused on building out its Internet infrastructure.

“If it’s like the parlor, they’re going to run into the same problem,” Greenfield told CNBC.

Other experts noted that successful social media firms require a growing number of users who post frequently, a challenge to revamp an existing platform.

O’Hare said the jump in DWAC’s share price was reminiscent of the outsized gains made by GameStop and other so-called “meme” stocks earlier this year, which were ripped apart by trading fundamentals.

“It’s gambling,” he said. “There’s no fundamental reason to look at the moves you’re looking for.”


Copyright Indian Lekhak Limited 2021. All Rights Reserved