The social media app shall be developed by Trump Media and Know-how Group (TMTG).
Rafael Henrique | LightRocket | Getty Photos
Phunware, which was concerned with Trump’s 2020 reelection marketing campaign, noticed a 470% surge in worth on Friday.
There isn’t a indication that DWAC and Phunware have a enterprise relationship. However Phunware’s rise final week coincided with the spike within the SPAC’s inventory.
Quick-seller Iceberg Analysis unveiled a bearish place on the DWAC on Monday, saying that traders face uncertainties on this blank-check deal as Trump might grow to be a dominant shareholder after the merger.
“Now that preliminary pleasure has handed, we see solely dangers for traders in close to future. Primarily based on Trump’s monitor document, at present worth, renegotiation is more likely to maintain extra of the merged firm for him,” Iceberg Analysis stated in a tweet.
“SPAC holders do not personal a bit of this venture but. Trump has leverage, not them.”
DWAC remained a well-liked chatroom matter amongst retail merchants, who had been credited final week with turning the SPAC into the newest sizzling “meme” inventory in 2021.
The DWAC ticker was the second-most common identify on Reddit’s WallStreetBets chatroom on Monday, after Tesla, the electric-vehicle big that hit a $1 trillion market capitalization on the identical day, in response to different knowledge supplier Quiver Quantitative.
One trending submit on WallStreetBets on Monday stated “DWAC- ALL IN,” which attracted greater than 500 feedback.
SPACs, also referred to as blank-check corporations, are created to boost capital within the public equities markets, with the objective of utilizing the money to buy or merge with non-public corporations.
Trump’s new social media firm, Trump Media & Know-how Group, on Wednesday stated it and DWAC had reached an settlement to merge in order that the previous president’s agency will grow to be a publicly listed firm.