If MoonPay cannot provide sufficient liquidity to support the ongoing purchase of the Token, the additional 750,000 users who joined within a week of TRUMP's launch may not be able to smoothly acquire the Token.
Author: Logan Hitchcock
Translation: Deep Tide TechFlow
MoonPay, a cryptocurrency payment company, successfully secured a total of $160 million in loan support from Galaxy Digital and Ripple to meet the explosive demand for Donald Trump's official Solana chain meme coin TRUMP during its launch weekend.
MoonPay President Keith Grossman revealed the details of this tripartite collaboration on the “When Shift Happens” podcast. He mentioned that MoonPay's CEO Ivan Soto-Wright made significant commitments for this, and the company also had to ensure that its reserve funds were free of any liens. Grossman stated, “The trading volume is enormous. Our crypto liquidity is locked in traditional financial ways in BlackRock's accounts… and it was a Saturday.”
Meanwhile, due to the promotional strategy of the Trump meme coin team, MoonPay's crypto reserve funds were quickly depleted. Users could purchase TRUMP through a mobile app called Moonshot, for which MoonPay is the exclusive crypto payment service provider.
Moonshot is designed for crypto newcomers, simplifying the process of purchasing meme coins. Users only need to register an account with their email and top up using a credit or debit card, avoiding the complexities of decentralized exchanges, making it very suitable for those new to cryptocurrency.
When users purchase TRUMP Token on Moonshot, their funds are converted into MoonPay's crypto reserves, primarily stablecoin USDC. These USDC are then used to purchase TRUMP Token on the Solana blockchain.
If MoonPay cannot provide sufficient liquidity to support the ongoing purchase of the Token, the additional 750,000 users who joined within a week of TRUMP's launch may not be able to smoothly acquire the Token. This would not only affect TRUMP's rapid growth in the early stages but could also have adverse effects on MoonPay's other users.
Grossman stated that if MoonPay's funds were exhausted, the app might prompt users with “Sorry, unable to complete the transaction.”
To prevent this situation, he, along with MoonPay's CEO Ivan Soto-Wright and CFO Mouna Siala, forecasted the required amount of funds. Initially, they estimated needing $50 million, but after reassessing the rapid growth of TRUMP Token within the first 24 hours of its launch, this figure quickly doubled to $100 million.
However, since MoonPay's reserve funds were locked in the traditional financial system and could not be accessed immediately, Grossman decided to contact Mike Novogratz of Galaxy Digital. After a brief communication, both parties quickly reached a loan agreement. MoonPay's team had to urgently process the relevant documents while confirming through BlackRock's connections that the company was capable of repaying the loan.
Even so, $100 million was still not enough. As demand for TRUMP Token continued to soar the next day, MoonPay sought additional help from Ripple Labs CEO Brad Garlinghouse.
“We underestimated the demand for the Trump token,” the MoonPay team told Garlinghouse.
Ripple's CEO agreed to provide additional funding support, but on the condition that MoonPay must obtain Galaxy's consent to ensure that the previous loan arrangement would not be affected. Ultimately, Ripple provided an additional $60 million loan to Galaxy, which was then transferred to MoonPay.
As traditional financial institutions in Europe and the U.S. resumed operations on Monday and Tuesday, MoonPay regained access to its funds and fully repaid the loan by Tuesday afternoon.
According to CoinGecko data, TRUMP Token averaged over $20 billion in trading volume in the first five days after its launch, and quickly reached a fully diluted valuation of over $73 billion in less than 48 hours (the theoretical total market cap assuming all tokens are unlocked).
A few days after its launch, TRUMP successfully listed on well-known centralized exchanges such as Binance and Coinbase's spot markets. The addition of these exchanges further lowered the barrier for new users to acquire the Token.
A representative from MoonPay confirmed to Decrypt that Grossman's account is accurate, but representatives from Galaxy and Ripple have not yet responded to Decrypt's request for comment.
Currently, the trading price of TRUMP Token is $15.37, down over 79% from its all-time high.
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