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HomeDigital World AcquisitionTrump-linked Digital World Acquisition Corp. (DWAC) Continues to Benefit “Bigly” From the...

Trump-linked Digital World Acquisition Corp. (DWAC) Continues to Benefit “Bigly” From the Boomerang Effect of Musk’s Twitter Moves

Digital World Acquisition Corp. (DWAC) (NASDAQ:DWAC) shares just recorded one of their best days of the year so far as Twitter seems to have fallen spectacularly out of favor, with the prediction of an $11 stock price target for the global town square growing ever more sonorous.

To wit, Digital Word Acquisition shares gained over 20 percent yesterday as Twitter shares entered a tailspin of sorts following Musk's abandonment of the takeover deal, giving rise to the specter of messy litigation ahead. In fact, the DWAC call with an exercise price of $40 and expiring on the 15th of July experienced a whopping 82 percent bullish volume yesterday as investors bank on a short-term rally.

Highlighting the doom loop that awaits Twitter now, a Rosenblatt analyst recently pegged an $11 stock price target for the social media giant in case the litigation avenue is unable to restore the deal.

With Trump taking pains to present his TRUTH Social app as a viable alternative to Twitter, it is hardly surprising that Digital World Acquisition shares, which act as a proxy for TMTG in the pre-merger phase, ended up as the biggest beneficiary of this ongoing social media maelstrom.

Bear in mind that Musk and Trump had both expressed somewhat positive feelings toward each other at the start of the CEO of Tesla's attempt to buy Twitter. For instance, Musk had stated in an interview that he would reverse the "morally bad" and "flat out stupid" decision to evict Trump from Twitter. However, in recent days, bad blood between the two volatile personalities seems to have gained the upper hand, with the former US President going so far as to label Musk a "bullshit artist".

TRUTH Social App Downloads in the US Between 20th of February and 26th of June


Digital World Acquisition shares have tumbled over 40 percent so far this year as the relatively healthy adoption rate of the TRUTH Social app has been somewhat neutralized by stability issues, slow onboarding in the initial stage, and the growing list of probes that have now been initiated against DWAC.

As an illustration, Digital World Acquisition recently filed a Form 8-K, revealing ongoing SEC investigations and subpoenas:

"As previously disclosed in Digital World's Current Reports on Form 8-K filed on June 13, 2022 and June 27, 2022, Digital World has been informed that it is the subject of an investigation pursuant to Section 8(e) of the Securities Act, with respect to the Registration Statement relating to its Business Combination. Digital World and certain of its directors have received SEC subpoenas, seeking various documents and information regarding, among other things, Digital World's due diligence regarding TMTG, communications regarding and due diligence of potential targets other than TMTG, and relationships and communications between and among Digital World (and/or certain of Digital World's officers and directors) and other entities (including ARC Global Investments II LLC, Digital World's sponsor, and certain advisors, including Digital World's underwriter and financial advisor in its initial public offering)."

The SEC is currently investigating Digital World Acquisition for securities fraud based on reports that the SPAC might have held private and undisclosed discussions about the merger with TMTG as early as May 2021 but failed to disclose this information in subsequent filings with the SEC.

Meanwhile, the fate of Trump's TRUTH Social app – and, by extension, that of Digital world Acquisition – appears to be inextricably linked with Twitter's, with the weakness in one generating strength in the other and vice versa. Given these dynamics, the retail investors appear to be paying close attention to the price action in DWAC shares for now, as demonstrated in the tweet above.


Wccftech Finance strictly adheres to political neutrality. Any reference to former President Trump or the SPAC Digital World Acquisition does not mean that we support or oppose his policies. This is purely a financial post featuring objective analysis.

The post Trump-linked Digital World Acquisition Corp. (DWAC) Continues to Benefit “Bigly” From the Boomerang Effect of Musk’s Twitter Moves by Rohail Saleem appeared first on Wccftech.

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