With the world’s greatest leader on social media, timing is everything. The window of opportunity for Wall Street to watch the financial markets can be in the blink of an eye – just milliseconds. This is not lost on Trump Media & Technology Group, as it is reported to be making financial institution contact in order to charge up to $100,000 a month for premium access to President Donald Trump’s Truth Social posts. The pricing plan proposed is a bold gamble that speed of information has become marketable.
In fact, Trump Media, the parent company of Truth Social, has been quietly soliciting clients for a new “paid” data feed service, dubbed Truth API. Sources close to the specific situation have reported that the communication firm has pitched a tiered pricing structure, which would allow traders and investment companies quicker access to posts from the top 10 most influential accounts on the platform. The best deal will be $100,000 per month, and a $60,000 per month package will be offered for any company that signs a three-year agreement. The discussions, which have been ongoing over the past few weeks, appear to be an important shift in strategy for the company as it seeks new money sources beyond its social media business.
The money involved would be quite extensive here, not only for Trump Media, but for the trading firms that may want to be a part of such a service as well. The company said Thursday that it has introduced the Truth API, which is a licensed data feed specifically for banks and trading institutions. The value of this offering may lie in the fact that Trump’s social media presence is itself valuable. His writings have traditionally had a significant impact on markets, investor sentiment and quick trading activity in various sectors. The edge is an advantage that could be worth millions of dollars in trading gains simply because a few seconds’ head start would give someone an edge to beat the rest of the market.
The proposed mechanism of operation is fairly simple. For now, the president posts on the platform and posts are transferred via the platform’s infrastructure and delivered to users via push notifications as usual. The Truth API would reportedly provide posts from the key accounts with less lag time, thus giving paying users an edge over the public. This makes it so that information that is supposed to be public will only be accessible to paying customers first and it has already attracted attention regarding market fairness and information parity.
The prospect naturally has sparked a lot of criticism from among Democratic lawmakers. Oregon Sen. Ron Wyden, who chairs the Senate Finance Committee, the highest-ranking Democrat on the panel, is greatly concerned with the financial impact and the larger moral issues that could be raised by such a deal. Wyden pointed out that the proposal would help the Trump family financially, and make Wall Street traders “rich,” as he explained. The senator’s rhetoric comes in the context of an ongoing concern that has been a common feature of Trump’s political career when it comes to the interplay between presidential communication, private financial interests, and market access.
When queried by the White House about Wyden’s comments, they directed questions to Trump Media & Technology Group, which did not immediately respond. This delegation of responsibility is particularly interesting because it raises questions into the administration’s stance on a service that has a direct link to the president’s official communications. The uncertainty is a further source of debate over an already controversial proposal.
As a company, the Trump API is an effort to diversify revenue for Trump Media. Since the company’s beginnings, it has struggled with a viable business model, and data licensing is a possible path to profitability. Trump Media could generate revenue from accessing its best information, which has proven to be worth a significant premium for Wall Street firms, by charging access fees for that content. The financial services industry has always been willing to spend a lot of money on low latency data feeds and high speed trading infrastructure and, in this offering, these expectations appear to be being met.
But the proposal also opens up uncomfortable issues of access and fairness in the financial system. Information asymmetry has always been an issue for financial regulators, meaning that some market actors know more than others. This one doesn’t include non-public information in and of itself, but it’s the speed this API provides that can be interpreted as an added disparity. If this is a violation of the rules of fair disclosure or an unfair playing field in the markets is a question regulatory bodies may have to consider.
If the trading firms are considering this service, they would engage in careful cost benefit analysis before subscribing to it. That is a lot of money to pay each month ($100K) and it may be worth it if the information edge produces a substantial return for large institutional investors who control billions of dollars of funds. The dilemma now is whether the posts the president posts have sufficient market-moving influence to justify a such an investment and whether the advanced notice given by the API is actually going to mean a trading advantage.
In addition, the proposal mentions the changing dynamics of policy communication and its relationship with the financial sector. Presidential communication is now evident on social media platforms, and speed of information dissemination on social media platforms can really impact the economy. Trump Media’s attempt to cash in on this dynamic introduces a new level of political communication – and financial markets – that will continue to be a point of contention and discussion.
Then there are the larger implications of the idea of a public information. If a president is using social media, the news is supposed to be available for all citizens to access. The Truth API defies that by offering a paid version of access that gives paying customers the competitive edge.
