For the Trump family, the troubles of American Bitcoin reflect the volatile nature of investments in digital assets
Plunged into an unprecedented crash, American Bitcoin Corp. is watching its stock face a free fall, losing over 95% of its value from its peak. In just 10 months, the company's obsession with crypto—at a time when the entire market was shifting its capital to the "golden ambush" of Artificial Intelligence (AI)—burned more than 600 million dollars from the value of the American president's son's stake. Now, with its back to the wall and the stock at a historic low, the company is moving forward with desperate actions to avoid its delisting from Nasdaq, at the exact same time its investors are demonstratively turning their backs.
The obsession with crypto
As Bitcoin slid into a bear market and demand for artificial intelligence surged, investors increasingly favored miners who could repurpose their infrastructure for data centers focused on AI. American Bitcoin, however, persisted with its cryptocurrency strategy and saw its shares plummet more than 95% from their peak. This wiped out over 600 million dollars from the market value of Eric Trump's stake over the last 10 months, according to Bloomberg calculations, and forced the company this week into a 1-for-15 reverse stock split in order to maintain its listing on Nasdaq. This turnaround highlights just how quickly investors have become averse to companies operating exclusively in cryptocurrencies. Success is no longer determined by who can produce the most Bitcoin, but by who has the flexibility to capitalize on electricity, land, and IT infrastructure. For the Trump family, the troubles of American Bitcoin reflect the volatile nature of investments in digital assets. Although President Donald Trump reported at least 1.4 billion dollars in cryptocurrency profits last year in his latest financial disclosure, many retail investors have been hit hard as Trump-linked tokens and the stock of American Bitcoin collapsed.
The Trump involvement in American Bitcoin
Eric Trump owns approximately 6% of American Bitcoin, according to Bloomberg calculations, and serves as the chief strategy officer. The stake held by advisor Donald Trump Jr. has not been publicly disclosed. It is ironic that when the predecessor company to American Bitcoin made its debut, it stated that its strategy would be to create a portfolio of data centers. American Data Centers Inc., a joint venture backed by Eric Trump and Donald Trump Jr., was founded by the investment bank Dominari Holdings Inc. (which features Trump as an advisor) in February 2025. Eric Trump had stated at the time that this was "critical for the development of AI infrastructure in the United States." Yet, just one month later, it changed course, closing a deal to receive mining equipment from a company called Hut 8 Corp. in exchange for an equity stake and an exclusive service agreement. Subsequently, the renamed American Bitcoin proceeded with a reverse merger with an already listed mining company, Gryphon Digital Mining Inc., and began trading on Nasdaq in early September. The stock price peaked five trading days later, closing at a high of 139.65 dollars on September 9.
The shift toward AI
As cryptocurrency prices took a plunge over the last nine months, investors rewarded other US-based miners for leasing their IT infrastructure to AI. Companies like Riot Platforms Inc., Cipher Digital Inc., MARA Holdings Inc., and TeraWulf Inc. all announced deals to expand into data centers. Their shares have risen by an average of over 60% this year, compared to the 77% plunge of American Bitcoin. "Every company I cover is shifting toward HPC (high-performance computing)," said John Todaro, an analyst at Needham & Co. However, American Bitcoin remained dedicated to a strategy of mining and accumulating Bitcoin. It might not even have many other options. The company's primary assets are its mining rigs and its Bitcoin inventories. Power, facilities, hosting infrastructure, and daily mining operations are provided by Hut 8, the majority owner of American Bitcoin, under exclusive service provision arrangements. This leaves most of the optionality for AI data centers with Hut 8, which has invested in this strategy through a corporate restructuring around energy infrastructure and through billion-dollar AI data center lease contracts. Shares of Hut 8 have more than doubled this year. Instead of treating Bitcoin mining as a stepping stone to AI infrastructure, executives at American Bitcoin argued that the cryptocurrency itself will ultimately yield the highest returns and that accumulating it during downturns will create greater value than redeploying capital elsewhere. The company also contends that the industry's shift toward AI could strengthen its position over time. As competitors redirect energy and capital toward data centers, fewer machines remain dedicated to securing the Bitcoin network, reducing mining difficulty and increasing the quantity of Bitcoin available to those who remain. Consequently, the AI boom may also offer an opportunity to capture a larger share of Bitcoin rewards. "We are seeing hundreds of megawatts from top public miners shifting toward AI," said CEO Mike Ho during the company's first-quarter earnings briefing. This "resulted in network difficulty dropping by about 6% this quarter."
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