Trump Media’s Bitcoin Strategy Raises New Financial Risks

Trump Media & Technology Group reported a $238 million loss for the second quarter, with digital assets accounting for most of the company’s losses. A newly disclosed risk in the Truth Social parent’s latest regulatory filing, however, highlights another potential source of losses tied to how the company is using its bitcoin holdings.

In a Securities and Exchange Commission filing on Monday, Trump Media disclosed a new risk factor that was not included in its previous filing. The company said it had placed some of its bitcoin with third parties to generate additional income, exposing those holdings to lending-related risks that could result in significant losses.

According to the filing, some of the third parties handling Trump Media’s bitcoin may not have established credit ratings. Those entities could also lend or pledge the cryptocurrency to other companies. Trump Media warned that its assets are not protected by government insurance if a counterparty defaults or enters bankruptcy.

The company also revised its description of revenue generated through bitcoin options. Under the updated terms, payments can be received in cash or, when a transaction is completed, in bitcoin. Its first-quarter filing had stated that such payments would be “immediately paid in cash.”

Trump Media specifically cited the failures of FTX, Celsius, Voyager and BlockFi as examples of the risks involved. The company warned that if a third party holding its bitcoin becomes bankrupt, the cryptocurrency could be included in that entity’s bankruptcy estate, potentially leaving Trump Media with “limited or no recovery.”

The filing also cautioned about “significant contagion risks” within the cryptocurrency industry, where the collapse of one company can create financial problems for other firms. Trump Media said its dependence on a relatively small group of third parties to generate income from its bitcoin increases that exposure.

More than two-thirds of Trump Media’s roughly 9,477 bitcoin is currently tied to financial arrangements. The company said 4,260.73 bitcoin is being used as collateral for $1 billion in debt, while another 2,077.34 bitcoin has been pledged under its bitcoin options strategy. Together, those positions account for 6,338.07 bitcoin.

Trump Media raised $1 billion through convertible notes as part of its effort to establish a bitcoin treasury. Convertible notes are a form of debt that can later be converted into company shares. The strategy has increased the company’s exposure to movements in the price of bitcoin.

Through the first half of 2026, Trump Media recorded nearly $361 million in realized and unrealized losses from digital assets. The company’s shares fell to a two-week low following its earnings report this week. Truth Social has also reportedly experienced a 36% year-over-year decline in monthly visitors.

The company is facing another controversy involving Truth Social. The Intercept Media and the nonprofit Freedom of the Press Foundation sued President Donald Trump on Wednesday over a program called “Truth API,” which is designed to provide faster access to his social media posts.

The organizations allege that Trump “stands to gain financially” by providing government information to parties “willing and able to pay his personal company,” describing the arrangement as “extraordinary, corrupt and unconstitutional.” Trump Media CEO Kevin McGurn said during the company’s earnings call that more than 10 companies had signed agreements for Truth API, with payments generally ranging from $60,000 to $100,000 per month.