NEW YORK – The designers of a cryptocurrency
launched by US First Lady Melania Trump in January
were accused in court filings on Oct 21 of organising the operation knowing that the digital currency’s value would plummet.
The $Melania coins were released for just a few cents each on Jan 19, the day before her husband Donald Trump was inaugurated as president of the United States.
Within hours, the $Melania coin’s price had soared to US$13.73 (S$17.80).
However, it then collapsed almost as quickly, and is now only worth around 10 cents – less than one per cent of its peak price.
In newly filed court papers, investors accuse the executives of the Meteora cryptocurrency exchange platform, on which $Melania was initially traded, of setting up a scheme that allowed them to indirectly purchase large quantities of this virtual coin.
Their accomplices then quickly resold these digital currencies, pocketing substantial profits while causing the price to plummet, according to documents filed Oct 21 in Manhattan federal court and initially reported by the news website Wired.
The allegations concerning $Melania have been added to legal proceedings involving several other cryptocurrencies, which began in April.
In the latest case documents, filed in the Southern District of New York, the plaintiffs said they did not believe Ms Trump to be “culpable”, but accused the crypto companies of using her and other familiar faces as “window dressing” for their crimes.
Meteora did not immediately respond to a request for comment from AFP.
According to a Financial Times investigation published last week, the Trump family has pocketed more than US$1 billion in pre-tax profits from several cryptocurrency-related products and companies over the past 12 months.
In addition to $Melania, Mr Trump launched $Trump a few hours before his inauguration.
And
the young company World Liberty Financial
, whose founders include Mr Trump’s three sons, has put the WLFI cryptocurrency up for sale for a total of US$550 million. AFP
