May 1, 2026
When Eric Trump started selling his cryptocurrency venture American Bitcoin (NASDAQ:ABTC) as a "money-printing machine," it sounded like the ultimate dream for investors riding the Bitcoin wave without actually buying the coins.
However, a recent Forbes report (1) highlighted a major disconnect. While the company's valuation once soared to $13.2 billion, retail shareholders have watched the stock price fall 92% from its original peak. That's about $500 million from regular people's portfolios simply evaporating into thin air.
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Trump's personal stake reportedly increased by about $90 million, rising from roughly $190 million to $280 million in net worth.
It's a tale as old as crypto time: early gains at the top, followed by steep losses for later investors once the hype fades.
The 'budget' version of the truth
How does a "money machine" lose that much value? The company leaned on a simple idea: mine Bitcoin at a discount. It pointed to production costs (2) of about $52,000 per coin while the market price was sitting near (3) $75,000. On paper, that looks like a home run.
However, that $52,000 figure only reflects direct operating costs, which include electricity and keeping the mining machines running. It's the "budget" version of their expenses.
Once you factor in the costs of doing business, the massive debt used to buy hardware, corporate overhead and financing, analysts say the real cost was closer to $100,000 (4).
That changes the picture. Your comfortable $23,000 cash profit suddenly turns into a $25,000 loss per coin on an all-in basis. That math only gets harder if Bitcoin's price dips further below the cost of production.
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Trump pushed back on those concerns, writing on X (5) that American Bitcoin holds more than 7,000 Bitcoin, runs close to 90,000 mining machines, and brought in $78.3 million in revenue in the last quarter.
As prices cooled, those thin margins got squeezed to the breaking point. In fact, American Bitcoin reported (6) a staggering $59 million loss in late 2025 because the value of the Bitcoin they were holding dropped.
While the company was marketed as a "money-printing machine," the reality looks more like a leveraged bet on Bitcoin staying near record levels. When prices drop, those profits vanish.
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The hidden risks behind 'can't-miss' crypto plays
American Bitcoin's fate isn't unusual for crypto.
By the time a stock is widely promoted as a "can't-miss" opportunity, the biggest gains have already been pocketed. Early investors and insiders often get in at a fraction of the current price, meaning they're sitting on a massive cushion while everyday investors are buying in at the peak of the hype.
One of the biggest red flags to watch for is "creative accounting." The company might highlight a low figure like $52,000 to mine a single Bitcoin, but that's often just the "bare-bones" cost. When you add in the actual expenses of running a massive operation, from corporate overhead to debt service, that real-world cost can climb much higher.
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What also needs to be considered is the "volatility trap." When Bitcoin is riding high, mining seems like a license to print money. But Bitcoin is known for its sudden price swings, and those profit margins can vanish almost overnight.
A third warning sign is when a company's hype doesn't match its bank account. People get excited about a "game-changing" idea, and they keep buying the stock, even if the business is in the red.
Eventually, the hype dies down, the reality sinks in, and the price crashes, which is what's happening with American Bitcoin. At the end of the day, it's not that Bitcoin mining is a bad business model; it's that the "money machine" story depends on which numbers the company chooses to show you.
If you're getting in late, you aren't just buying a stock; you're taking on the risk that the early guys have already offloaded.
Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines.
Forbes (1); CoinDesk (2); MarketWatch (3); KuCoin (4); X (5); TradingView (6)
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Laura Grande is a freelance contributor with nearly 15 years of industry experience. Throughout her career she's written about and edited a range of topics, from personal finance and politics to health and pop culture.
