First Lady Melania Trump’s $MELANIA memecoin is now facing legal scrutiny after a court filing alleged the cryptocurrency was part of a broader fraudulent “pump-and-dump” scheme designed to enrich insiders, with the first lady allegedly used—without her knowledge—to lend credibility to the project.
The $MELANIA token, a memecoin that describes itself as “official” and has been publicly promoted by the first lady, launched in January alongside President Donald Trump’s inauguration. A lawsuit originally filed in April by cryptocurrency traders accused a group of developers and promoters of orchestrating a coordinated fraud involving several memecoins, including $M3M3, $LIBRA, $ENRON, and $TRUST. An amended complaint filed this week adds $MELANIA to that list.
The lawsuit does not accuse Melania Trump of participating in the alleged fraud. Instead, it portrays her as an unwitting figurehead whose name and public profile were used as “window dressing” to make the scheme appear legitimate. Plaintiffs argue that had her team been aware of the alleged criminal conduct, any consent or association with the project would have been withdrawn immediately.
According to the complaint, the defendants—among them crypto developer Benjamin Chow and executives linked to marketing firm Kelsier Ventures—followed a repeatable playbook. They allegedly launched memecoins using controlled access mechanisms, artificially boosted demand through influencers and paid promotions, and then sold their own holdings at inflated prices, triggering sharp collapses that left other investors with losses.
The filing claims the group exploited a proprietary system within the Solana blockchain that allowed them to control token distribution and timing, giving them privileged access to buy at low prices and sell at peaks. Influencer campaigns allegedly created the false impression of organic enthusiasm, while celebrity associations were used to draw in retail investors unfamiliar with crypto markets. Melania Trump’s endorsement of $MELANIA is described as part of a strategy to “borrow” fame to expand the pool of potential victims beyond crypto traders to mainstream consumers.
Plaintiffs argue that investors believed price movements reflected natural market forces, when in reality the market was allegedly dominated by a small group of insiders manipulating outcomes behind the scenes. The lawsuit claims the dramatic volatility of the $MELANIA token is evidence of this manipulation.
As of Wednesday afternoon, $MELANIA had a market capitalization of about $85 million, with the token trading at roughly $0.093. Shortly after its January launch, the coin briefly exceeded a $2 billion market cap before losing more than half its value within days, a collapse the plaintiffs attribute to insiders selling off their holdings.
The case is still in its early stages, and it remains unclear whether it will proceed to trial. The plaintiffs are seeking a range of remedies, including the return of alleged illicit profits, injunctions barring future schemes, and the appointment of an independent receiver to take control of the blockchain infrastructure they say was used to execute the fraud.
Forbes estimates Melania Trump’s net worth at around $20 million, with the memecoin representing a significant portion alongside income from books, speaking engagements, and media projects. President Trump’s net worth is estimated at approximately $7.1 billion.
The lawsuit comes amid a broader push by the Trump family into cryptocurrency, which has become a major driver of the president’s recent wealth growth. Through memecoins, bitcoin holdings, and the family-backed World Liberty Financial venture, Trump has added an estimated $2 billion to his fortune since returning to office. Other family members have also benefited financially from the expansion into digital assets.
