Key Takeaways:
Eric Trump, co-founder of American Bitcoin (ABTC), has accused Forbes of publishing “Chinese propaganda” following a report that claims the venture preys on MAGA-minded investors and has erased approximately $500 million in retail shareholder value.
"Friends, educate yourselves as to the source of your information... in this case, China!" Trump wrote in a rebuttal, branding the financial magazine "an embarrassment to journalism."
A Forbes investigation published Tuesday alleges American Bitcoin is an arbitrage vehicle that sells inflated shares to buy Bitcoin on the open market. The report claims the company’s market cap has fallen roughly 92% from a peak of $13.2 billion, with the stock price crashing from a debut high of $14.52 to $1.16.
The dispute highlights the growing intersection of political rhetoric and cryptocurrency ventures, placing the performance of politically-affiliated projects under a microscope. While Trump’s response focused on operational metrics, his rebuttal did not address the estimated $500 million in retail investor losses, with the market now awaiting ABTC’s Q1 results for further clarity.
The Forbes report paints a grim picture for retail investors in American Bitcoin. It alleges that ABTC functions primarily as a vehicle to arbitrage its own stock, selling shares at an inflated value and using the funds to purchase Bitcoin. According to the magazine, this strategy has led to a market cap collapse to about $1.24 billion.
Forbes also disputes the company's mining efficiency, claiming that around 70% of ABTC's Bitcoin was bought on the open market, not mined. The investigation pegs the all-in cost per coin near $90,000 when including depreciation and overhead, significantly higher than the $57,000 figure that Eric Trump has cited. ABTC went public in September through a merger with Hut 8 on the NASDAQ exchange.
In response, Trump focused on the firm's operational capabilities and recent performance. He pointed to Q4 revenue of $78.3 million, a 22% increase quarter-over-quarter. He also highlighted the company's infrastructure, which includes 28 exahash of capacity and nearly 90,000 miners.
Trump's defense also leaned on the company's Bitcoin treasury, which has grown to over 7,000 BTC. This makes American Bitcoin the 16th largest public holder of Bitcoin, according to data from Bitcoin Treasuries. The "Chinese propaganda" framing of the Forbes article mirrors tactics recently used by other public figures, including Treasury Secretary Scott Bessent and Binance founder Changpeng Zhao, to discredit critical media coverage.
This article is for informational purposes only and does not constitute investment advice.
