Bitcoin Mining Firm Linked to Trump Family Plummets 90%

Trump-Linked Bitcoin Miner Faces Steep Losses Post-IPO

A cryptocurrency venture co-founded by Eric Trump, American Bitcoin Corp (ABTC), has experienced a dramatic collapse in its stock value, losing nearly 90% of its market capitalization within six months of its public debut. The company’s trajectory offers a stark case study in the volatile world of digital assets and the potential pitfalls of celebrity-backed enterprises.

The Genesis of American Bitcoin Corp

In early 2025, American Bitcoin Corp emerged as a significant player in the Bitcoin mining sector. The company’s origins trace back to a partnership between Donald Trump Jr., Eric Trump, and Dominari Holdings, which initially aimed to establish AI data centers under the name American Data Centers. However, the focus rapidly shifted to Bitcoin mining.

The pivotal moment for ABTC was its acquisition of the Bitcoin mining assets of Hut 8, a publicly traded company. Hut 8, facing profitability challenges in its core mining operations, particularly after the April 2024 Bitcoin halving event, sought to divest its mining infrastructure. In May 2025, Hut 8 agreed to sell its Bitcoin mining business to American Data Centers, which subsequently rebranded as American Bitcoin Corp (ABTC).

The transaction was structured as an all-stock deal. Hut 8 transferred its mining rigs and facilities to ABTC in exchange for an 80% equity stake in the newly formed entity. The remaining 20% was held by the Trump sons and Dominari Holdings. This strategic move effectively made ABTC a majority-owned subsidiary of Hut 8, despite the Trump family’s prominent association.

A Complex Corporate Structure and Valuation Discrepancy

The operational relationship between Hut 8 and ABTC is intricate. Hut 8 retained ownership of the physical data center buildings and continued to provide essential services such as electricity and technical support through a hosting agreement with ABTC. ABTC, in turn, owns the Application-Specific Integrated Circuits (ASICs) – the specialized computers used for Bitcoin mining – and receives the Bitcoin generated by these machines. ABTC pays Hut 8 hosting fees for the use of its facilities and infrastructure.

A key question arises regarding the rationale behind Hut 8’s divestment. Hut 8 transferred assets valued at $126 million (the book value of the ASICs) to ABTC. In return, Hut 8 received an 80% stake in a company that, at the time of its public listing, had minimal operational assets beyond the acquired mining rigs. This raises concerns about the valuation and the perceived benefit for Hut 8, which effectively gave away a 20% stake in its mining assets for a significant share of a company that was essentially a shell prior to the transaction.

The Role of Reverse Mergers and Stock Promotion

ABTC’s path to the NASDAQ was not through a traditional Initial Public Offering (IPO). Instead, it utilized a reverse merger. This complex financial maneuver involved merging with a struggling publicly traded company to gain immediate access to public markets without the rigorous IPO process. ABTC’s listing on the NASDAQ was the third iteration for that specific stock ticker, following previous entities like Aerna Corp and Griffon Digital Mining, both of which had experienced significant financial distress and stock depreciation.

In May 2025, ABTC agreed to merge with Griffon Digital Mining. Under the terms of this merger, ABTC shareholders received 98% of the combined entity’s shares, while Griffon’s shareholders received only 2%. This reverse merger led to ABTC’s shares trading on the NASDAQ under its own ticker. Upon the merger’s completion in September 2025, ABTC commanded an initial market capitalization of $5 billion, despite its tangible assets being valued at only $126 million.

Eric Trump, serving as Chief Strategy Officer, has been identified as a key figure in promoting the company’s stock. His role, as described, involves leveraging public appearances and social media to advocate for ABTC as a compelling investment opportunity. This stock promotion strategy, coupled with the Trump name, is believed to have contributed significantly to the company’s inflated initial valuation.

Dilution and Investor Losses

Following its public listing, ABTC engaged in a strategy of significant share issuance, a process known as dilution. The company’s share count ballooned from approximately 550 million shares at its inception to over 1 billion by February 2026, effectively doubling within less than a year. These share sales, including private placements and at-the-market offerings, raised over $400 million.

The proceeds from these share sales were primarily directed towards acquiring more mining equipment and accumulating Bitcoin as a treasury asset, mirroring strategies employed by companies like MicroStrategy. As of February 2026, ABTC held 5,410 bitcoins, valued at approximately $380 million at the time of recording. Notably, only about one-third of these holdings were generated through mining; the remainder were purchased on the open market.

Despite holding substantial Bitcoin reserves, the aggressive share issuance strategy has severely impacted the stock price. After reaching a peak of nearly $10 per share upon the merger’s closure in September 2025, ABTC’s stock price has plummeted to just over $1, representing a loss of almost 90% for investors who bought in during the initial trading period. While the company’s market capitalization remains above $1 billion, it continues to trade at a premium to its Bitcoin holdings, suggesting the market is still pricing in future growth or speculative value.

Market Impact and Investor Outlook

The dramatic price decline of ABTC highlights the inherent volatility of the cryptocurrency market and the risks associated with companies whose valuations are heavily influenced by promotional activities rather than fundamental operational performance. For investors, the case of ABTC serves as a cautionary tale about the potential for significant losses in highly speculative assets, particularly those linked to prominent public figures.

The company’s stated strategy to maximize Bitcoin per share implies a continued issuance of new shares to acquire more Bitcoin. This approach, while potentially increasing the company’s Bitcoin reserves, is likely to exert further downward pressure on the stock price, posing a challenge for existing shareholders seeking to recoup their investments.

While retail investors have faced substantial losses, the co-founders, including Eric and Donald Trump Jr., remain significant shareholders. Their substantial holdings, acquired at a near-zero cost basis according to the analysis, represent a considerable paper value, even after the stock’s sharp decline. This disparity underscores the different outcomes for early stakeholders versus later investors in high-growth, high-risk ventures.

“This will also serve as a case study for how the Trump family has profited from President Trump’s second term.”

The narrative surrounding ABTC also intersects with the broader political landscape, as the Trump campaign received significant contributions from the crypto industry during the 2024 election cycle, with promises of a pro-crypto presidency. The subsequent market performance of companies like ABTC, and the Trump family’s financial gains from crypto-related ventures, adds a complex layer to the intersection of politics, finance, and digital assets.

Source: Eric Trump's Bitcoin Company Is Imploding (YouTube)