Former President Donald Trump made a surprise return to X (formerly known as Twitter) on Thursday night after surrendering at the Fulton County jail in Georgia. This move caused a decline in DWAC stock, the special purpose acquisition company that aims to take Trump’s own tech and social-media platform public. Trump’s single post on X, featuring his mug shot and a fundraising link for his 2024 presidential bid, pushed DWAC stock down 3% initially before recovering some losses.
DWAC stock’s value is closely tied to the Donald Trump brand, and his status as the top Republican candidate for president is a major factor. However, federal charges against Trump could potentially tarnish his brand, although this has not happened so far. DWAC stock has already experienced a significant decline, down 92% from its high in October 2021. On July 21, the stock surged by 50% after DWAC reached a fraud settlement with the U.S. Securities and Exchange Commission (SEC). The settlement includes a civil penalty fee of $18 million if the merger with TMTG, the parent company of Trump Media, is completed.
Despite initially stating that he would only remain on Truth Social, Trump’s return to X could redirect a significant portion of Truth Social’s audience to the more mainstream channel. DWAC is currently looking to extend its deadline for completing the merger, with a special meeting scheduled for September 5 to vote on the new extension.