Shares of Trump Media & Technology Group, the company behind Truth Social, experienced a significant 18% drop on Monday.
This decline marked a continuation of losses seen since its stock market debut the previous month. The company’s announcement that it might sell millions of shares in the future, including former President Donald Trump’s entire stake, contributed to the market downturn.
Trading in the company’s stock has been turbulent, attracting both enthusiastic Trump supporters and skeptical short sellers who view the stock as overvalued.
The downward trend began shortly after the company’s listing on March 26 following a merger with Digital World Acquisition Corp.
Initially priced at $70.90, the stock has since plummeted nearly 60%, closing at $26.61 on Monday. The filing of a registration statement, a standard procedure after a company goes public through a special purpose acquisition company (SPAC), signaled the possibility of future share sales.
This move is customary and allows for the resale of shares held by parties unable to sell them freely without registration.
While the filing does not imply an immediate sale, it does pave the way for Trump to potentially offload his shares once the lock-up period expires or is waived.
The filing disclosed Trump’s ownership of 114.8 million shares, alongside an additional 21.5 million shares subject to sale upon the exercise of warrants issued during the company’s IPO.
Trump’s involvement with the company comes amidst ongoing legal proceedings, as he faces trial in a Manhattan court regarding alleged hush money payments to a porn star, maintaining his plea of not guilty.
