Following his arrest at the Fulton County jail in Georgia on Thursday night, the former president of the United States unexpectedly returned to X, formerly known as Twitter. Early on Friday, the move caused the stock of Digital World Acquisition (DWAC), the special purpose acquisition firm intending to float Trump’s own internet and social media platform, to decline.
Accused Of Being A Criminal
Trump only ever posted a picture of himself in jail on X. Thursday night caused the DWAC stock to drop by 3% in the beginning before it recovered in above-average volume. Shares increased by almost 3.3% to 14.30 on Friday during trading. DWAC decreased by 0.4% to 13.93 on Thursday.
The former president shared a photo of himself in jail along with a donation link for his 2024 presidential campaign. He last posted on social media on January 8, 2021. Trump is accused of being the leader of a criminal organization that sought to rig Georgia’s 2020 presidential election.
The photograph of the suspect has the caption, “ELECTION INTERFERENCE.” “NEVER GIVE UP!”
Trump Media and Technology Group (TMTG) will be made public by DWAC through a reverse merger. The conservative social media site Truth Social is a subsidiary of Trump Media.
Following the brawl at the U.S. Capitol on January 6, 2021, Twitter, now known as X, suspended Trump’s account. This led to the creation of Truth Social. In October, Elon Musk purchased the social media platform and restored Trump’s account. According to some business analysts, a move back to X might shift a significant chunk of Truth Social’s audience to the more mainstream channel. Trump has earlier indicated he would avoid using X and instead stick to Truth Social.
DWAC Stock And Trump
Source: History
The value of the Donald Trump brand is closely correlated with the price of DWAC stock. Trump’s current position as the leading Republican presidential candidate directly affects the stock’s valuation. According to company documents, federal charges might possibly damage that brand, but so yet that has not happened.
DWAC stock is down almost 92% from its high of 175 on October 22, 2021, which was reached shortly after the Trump merger deal was announced. Since January 2022, when Musk started his purchase of Twitter, shares have decreased by 81%.
According to the terms of the agreement with the SEC, DWAC must pay $18 million in civil penalty fines if it successfully merges with TMTG. The SEC has agreed to forego the fine, though, if the merger does not take place by January 1, 2025 and DWAC restores investor funds.
Before filing for an initial public offering, the SEC claimed that unlawful merger negotiations had taken place. In the meantime, DWAC is attempting to extend the deadline for concluding its merger once more this month. A special meeting of the SPAC has been planned for September 5.
