The Chief Executive Officer of Digital World Acquisition Corp, which was to serve as the financial backer for Trump Media & Technology Group, the owner of Truth Social, characterized the recent $1 billion investment loss as a “positive development” in a recent press statement. The company is currently navigating through a storm of legal challenges and financial difficulties following accusations of insider trading.
DWAC Receives Termination Notices
Digital World Acquisition Corp, established as a special-purpose acquisition company (SPAC) to take Trump’s Truth Social public on the stock exchange, has recently faced a setback. According to CBS News, the company received termination notices from investors amounting to $467 million out of the total $1 billion funding raised.
DWAC Will Return the Remaining $533 Million
DWAC also declared its intention to refund the remaining $533 million following the withdrawal of $467 million in investor commitments.
It’s a Positive Development, States Swider
Trump’s CEO Swider stated in a Press release, “Despite how others may seek to characterize the commitment cancellations, we want our shareholders to understand that these cancellations are a positive development in our ability to consummate the business combination.”
A Sustainable Business Model
Trump’s media group is reportedly focused on developing a “sustainable business model” after several attempts to complete a merger between DWAC and Trump Media and Technology Group failed to close.
Trump’s Media Group Under Financial Strain
Trump Media & Technology Group faces a growing veil of uncertainty following the investment losses and questions about its future financing post-merger, which is reportedly still in progress. Initially, the plan involved Digital World Acquisition Corp (DWAC) supplying Trump Media & Technology Group with a substantial pool of funds upon the completion of the merger.
DWAC Narrowly Avoided Liquidation
CBS News has further reported in an article written by Aimee Picchi that DWAC came close to liquidation last month through the multiple delays of the merger. The CBS News article said that DWAC shareholders have approved “a one-year extension of the merger deadline between the two companies.” The groups have now been given until September 8, 2024 to merge.
Plans to Complete Merger ASAP
TMTG CEO Devin Nunes said, “Today’s announcement is an important step towards eliminating the PIPE, which TMTG believes would be in the best interest of TMTG’s equity holders.” Nunes further stated they planned to complete the merger with DWAC “as soon as possible.”
Tremendous Opportunities for Truth Social
Nunes further stated, “With this vote of confidence from DWAC shareholders, we will proceed as quickly as possible to complete our merger, which we expect will open up tremendous new opportunities to grow and expand TMTG and the Truth Social platform.”
Trump to Take On X and Meta
Trump’s endeavors to establish a social media platform to compete with counterparts like X and Meta (Facebook) have not materialized as he expected.
Investor Presentation Claims It Will Have 81 Million Users
In an investor presentation, the company projected that Truth Social would reach 81 million users by 2026, with an anticipated growth in average revenue per user to $13.50. However, this assertion has been contradicted due to the platform’s sluggish current growth and low adoption of new users.
Statistica List of Most Popular Social Networks Worldwide
In October, Statistica published a list of the most popular social networks, and notably, Truth Social did not secure a spot on the list.
Facebook Has Over 3 Billion Active Monthly Users
Statistica reported that the market leader Facebook was “the first social network to surpass one billion registered accounts and currently sits at more than three billion monthly active users.”
Only 23,000 Android Users Downloaded Truth Social
Statistica further highlighted in a separate report that Truth Social, the social media app officially launched in February 2022, garnered around 1 million monthly downloads. Following its availability to Android users, the app experienced a significant decline, recording only 23 thousand downloads from Android users in September this year.
Trump Uses Site for Hate Speech
Trump has frequently faced accusations of utilizing his platform to disseminate misinformation and promote hate speech. In connection with Trump’s rally in Hialeah, Florida, he wrote: “If you don’t want to let the Communists destroy America like they destroyed Cuba, Venezuela, and Nicaragua, then you need to send a message by voting Crooked Joe Biden and every last Democrat out of office in 2024!
Stand With Me and Fight
“This race is not just about beating Crooked Joe—it’s about DEFEATING the entire rotten, corrupt, and tyrannical establishment in Washington, DC. 2024 is our final battle. Stand with me in this fight, and we will FINISH the job that we started 7 years ago tonight!” Trump’s post concluded.
Biden Joined Truth Social Site
On a positive note, President Biden’s campaign declared his participation on Donald Trump’s social media platform in October. A spokesperson for Biden informed Fox News that they joined the platform intending to connect with voters in the spaces where they engage.
Republicans Can Be Our Best Messengers
“We will be leveraging the fact that Republicans can sometimes be our best messengers,” Biden’s spokesperson went on to explain to Fox News.
Joining Would Be Funny
Biden’s campaign further admitted on X, “We just joined Truth Social, mostly because we thought it would be very funny. Follow us there for truths and retruths or whatever they call them: http://truthsocial.com/@BidenHQ”
Investor’s Arrested on Insider Trading Charges
However, it’s not all laughs for Trump’s Truth Social. In June, federal prosecutors apprehended three investors on charges of insider trading linked to Digital World’s agreement with Trump’s media company.
Investors allegedly made over $22 million illegally
Per the indictment, the three investors purportedly gained over $22 million through illicit trading based on the information that DWAC would acquire TMTG before it became public knowledge. The trial for this case is slated for March next year.
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