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On Tuesday, DWAC stock closed at $92.90, 8.58% up. After hours, it slightly declined by 2.42 to reach $90.65. Its market cap totaled $3.457 billion.
Shares of Digital World Acquisition Corp (NASDAQ: DWAC), a blank check company known as a SPAC behind Donald Trump‘s Media & Technology Group (TMTG), have been lately surging. DWAC stock has been going up starting from Monday, a day after former US President Donald Trump launched his own new social media venture Truth Social.
On Monday, DWAC stock ended the trading session at $84.32. On Tuesday, DWAC shares surged nearly 30% in premarket trading. Further, yesterday, DWAC stock jumped 26% to $106.44, which even topped the record levels last seen in October 2021, when DWAC shares soared by 400%. The stock closed at $92.90, 8.58% up. After hours, it slightly declined by 2.42 to reach $90.65. Its market cap totaled $3.457 billion.
Background for DWAC Stock Rally amid Truth Social App Hype
To start with, Digital World Acquisition Corp is a blank check company (SPAC) formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. Currently, DWAC is on the news as a result of its intention to merge with Donald Trump’s new social media venture, Truth Social, and take it public.
Truth Social is Donald Trump’s social media app that appeared as his response to Twitter Inc (NYSE: TWTR), Meta Platforms Inc (NASDAQ: FB), and Alphabet Inc‘s (NASDAQ: GOOGL) YouTube that banned the former US President from their platforms following the attack on the US Capitol Hill. The app went live on Sunday, February 20, but has already reached the top on Apple Store. As we have reported, just within 24 hours of launch, Truth Social became the most downloaded app.
Notably, there were some glitches like error messages upon entering a birthday, e-mail, or phone number while creating new accounts. However, the app managed to be on top despite these hurdles. Since the launch, Truth Social was downloaded as many as 170,000 times.
Commenting on the growth of DWAC stock amid the success of Truth Social, Dennis Dick, head of markets structure at Bright Trading LLC in Las Vegas, said:
“It’s driven by hype but I’m skeptical that the retail driven frenzy can be sustained. From a fundamental perspective, it’s too early to tell. Trump has a huge following and they could move from traditional social media to this platform… but it depends on how good the app is.”
Soma analysts are skeptical about the app’s further competition with rivals like Twitter or Facebook. However, considering the interest in Trump and his activity, his app has good chances for further success.