ABTC Stock Plunges as Eric Trump Crypto Venture Faces Renewed Volatility

It took just 26 minutes for American Bitcoin Corp. (ABTC) to go from a routine open to a full-blown meltdown. The Eric Trump–backed crypto miner saw its shares plunge nearly 40% on Tuesday after a long-awaited lock-up expiration unleashed a wave of insider selling, erasing roughly $1 billion in market value and triggering multiple Nasdaq trading halts. Trading volume spiked to nearly 40 times its daily average as the stock collapsed from about $2.39 to $1.46, marking one of the most violent swings for a newly listed crypto equity this year.

The sudden rout cast a fresh spotlight on Eric Trump’s crypto venture, which has become a magnet for both speculative enthusiasm and deepening market skepticism. Executives insisted the volatility was expected as early shareholders gained the ability to offload stock, but the scale of the drop underscored how fragile sentiment has become in the late-2025 crypto downturn. Though ABTC clawed back a modest 9–11% in pre-market trading on Wednesday, investors are now questioning whether the plunge was a momentary shock or a warning sign for the Trump-branded crypto empire.

Flash Crash Hits Trump-Backed Crypto Stock

American Bitcoin Corp (ABTC) Price

Source: Yahoo Finance

ABTC’s collapse was as swift as it was severe. Within the first five minutes of Tuesday’s session, losses accelerated past 40%, briefly exceeding 50% before midday as sell orders flooded the market. The sudden wave of activity overwhelmed liquidity so quickly that Nasdaq had to halt trading multiple times, a rare sequence for a company that had been trading quietly in the $2–$3 range for weeks. By the time normal trading resumed, ABTC had already cemented its place among the most volatile names in the crypto-equity space.

Company officials pointed to a single catalyst: the expiration of ABTC’s lock-up period, which allowed pre-merger shareholders to sell their restricted shares for the first time. As those early investors rushed to realize gains, the stock’s limited float magnified the impact. “The next few days will be choppy as shares find new homes,” President Matt Prusak wrote on X, attempting to calm the market as the plunge unfolded. Meanwhile, Executive Chairman Asher Genoot emphasized that neither Eric Trump, Donald Trump Jr., nor Hut 8 Corp. sold any shares during the unlock — a message designed to signal stability amid the chaos.

Eric Trump’s Crypto Ambitions Under Pressure

Source: X

ABTC’s dramatic selloff has put renewed focus on Eric Trump, whose growing involvement in digital assets helped propel the company into the spotlight earlier this year. As co-founder and Chief Strategy Officer, Trump has actively positioned American Bitcoin as a major player in U.S. bitcoin mining, frequently highlighting claims that the company handles as much as 2% of the world’s bitcoin supply. That visibility fueled strong early momentum after ABTC went public in September, briefly turning Trump into a paper billionaire as the stock surged to more than $9 in its opening weeks.

But the optimism surrounding the Trump-linked crypto ecosystem has cooled sharply. Heading into the lock-up expiration, ABTC had already fallen more than 75% from its peak, mirroring a broader pullback in Trump-associated crypto ventures. Still, Trump has publicly insisted that the fundamentals haven’t changed. In comments made on X, he framed the plunge as routine profit-taking and reaffirmed his long-term stance: “I’m holding all my ABTC shares — I’m 100% committed..”. Supporters see Trump’s continued backing as a vote of confidence, while skeptics argue it highlights just how much of ABTC’s valuation hinges on the Trump brand itself.

Market Cap Wipeout and Trading Frenzy

Tuesday’s collapse delivered one of the most dramatic valuation shocks ABTC has experienced since going public. The stock’s 38.8% plunge wiped out roughly $1 billion in market capitalization in a matter of minutes, underscoring how sensitive the young company remains to shifts in supply and sentiment. With the lock-up expiration suddenly releasing a flood of previously restricted shares, the market was hit with nearly 40 times the normal trading volume — an avalanche of sell orders that buyers simply couldn’t absorb fast enough.

The chaotic session also highlighted ABTC’s liquidity risks. Before the lock-up, the company had a relatively tight float, which had helped fuel the explosive rally that pushed the stock above $9 shortly after its debut. But that same scarcity amplified the downside once shares became eligible for sale. As volumes surged and the stock slid toward intraday lows around $1.20–$1.30, bargain-hunters stepped in, helping lift ABTC back above $1.50 by the close. Even with the late-session stabilizing, the episode left investors questioning whether this level of volatility is a structural feature of American Bitcoin — or simply the growing pains of a still-maturing crypto miner.

Bitcoin’s Parallel Movements and Decoupling

Bitcoin (BTC) Price

Source: CoinMarketCap

ABTC’s plunge stood out not just for its severity but for how starkly it diverged from Bitcoin’s own price action. While the broader crypto market has been cooling for weeks, Bitcoin itself was relatively stable — even showing a modest rebound — during the very hours ABTC was in freefall. This disconnect underscores how company-specific dynamics, rather than crypto fundamentals, drove the collapse. Despite being positioned as a leveraged play on Bitcoin, ABTC has shown only a 0.13 correlation with BTC over the past month, highlighting just how loosely its performance tracks the world’s biggest digital asset.

The turbulence also echoed a broader pattern across Trump-affiliated digital ventures. Several high-profile memecoins linked to the former first family have suffered near-total losses this year, and Trump Media & Technology Group — another crypto-exposed business — is down sharply as well. That context matters: speculation tied to the Trump brand fueled outsized gains during ABTC’s early rally, but it is now contributing to disproportionately steep declines. And with Bitcoin down more than 30% from its recent highs — falling from about $126,000 to $92,000 during the autumn slide — ABTC’s 75%-plus decline from peak levels shows just how much more vulnerable it is to shifts in sentiment than the underlying cryptocurrency itself.

Price Outlook: Can ABTC Stabilize or Is More Volatility Ahead?

With ABTC reeling from its steepest one-day drop since going public, investors are now turning their attention to what comes next — and whether the stock can find its footing after the lock-up shock. In the short term, analysts expect continued volatility as the market digests newly unlocked shares and evaluates whether additional insider selling could emerge. The modest 9–11% rebound in Wednesday’s pre-market trading suggests there is still liquidity on the buy side, but not yet enough to establish a reliable floor. If trading volumes normalize and selling pressure eases, ABTC could attempt to stabilize in the $1.40–$1.80 range over the coming sessions.

Looking further ahead, ABTC’s price trajectory will depend heavily on two forces: crypto market recovery and investor confidence in the Trump-led strategy. Bitcoin’s retreat from $126,000 to around $92,000 has weighed on sentiment, but a rebound toward six-figure levels could provide some uplift to crypto-exposed equities like ABTC. Under a more optimistic scenario — where Bitcoin regains momentum and ABTC demonstrates consistent profitability — the stock could retest the $2.50–$3.00 range over the next quarter.

A bearish outcome, however, remains on the table. If crypto markets continue sliding, or if early shareholders continue to offload stock as more lock-up periods expire, ABTC could revisit its intraday lows in the $1.00–$1.20 band. Skeptics also warn that ABTC’s weak recent correlation to Bitcoin suggests the stock may struggle to benefit even in a broader crypto rebound unless the company proves its fundamentals can stand independently of hype.

What Investors Should Watch Next

ABTC’s stunning plunge has left traders weighing whether the crypto miner is experiencing a temporary shock or entering a more prolonged phase of instability. Much of the near-term outlook hinges on how quickly the market can absorb the newly unlocked shares and whether selling pressure cools as early investors complete their profit-taking. Any indication that insiders — including the Trump family and Hut 8 leadership — continue to hold their positions will be closely scrutinized as a signal of internal confidence.

Beyond share dynamics, broader crypto market conditions will continue to set the tone for ABTC’s recovery prospects. A rebound in Bitcoin could help lift sentiment across digital asset equities, but a deeper slide in the crypto complex would likely keep ABTC pinned near recent lows. At the same time, American Bitcoin’s operational performance — including mining efficiency, treasury management, and future quarterly results — will determine whether the company can shift the narrative from volatility to growth.

For now, ABTC remains a high-profile symbol of the unpredictable intersection between politics, personality-driven investing, and the ever-evolving crypto economy. Investors willing to stay in the trade may find opportunities as volatility settles, but the coming weeks will be critical in determining whether American Bitcoin can rebuild trust — or whether the latest shock marks a deeper turning point for Eric Trump’s crypto ambitions.