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Why digital world acquisition phunware crashed Nasdaq and Phunware

Acquisition of Digital World (NASDAQ: DWAC) and Phunware (NASDAQ: PHUN) software rose more than 1,000% at one point last week. Former President Donald Trump has a fever. Digital world acquisition corp

However, investor opinions about the company faded on Tuesday. At the close of trading, shares of Phunware and Digital World Acquisition were down 39% and 30%, respectively.

Digital world acquisition corp

The drop in the share price of Digital World Acquisition appears to have been caused by Trump’s comments before the market opened. Investors cheered last week when SPAC announced plans to merge with Trump Media & Technology Group. But the excitement seemed to fade when the former president shared details about his plans to build a new social network to compete with Facebook and Twitter, and a video streaming service to challenge Netflix.

In a statement, Trump acknowledged that it would be difficult to compete head-on with these tech giants. In addition, these platforms need to be able to quickly attract millions of users, not just Republicans, but independents and Democrats as well.”

These comments are likely to cool investors’ hopes about Trump’s quick plan to build the social media platform and the potential for quick returns.
Meanwhile, Phunware, which surged last week on hopes that investors can act as a major technology provider for Trump’s social network or streaming service, has also given up much of its recent rally. Phunware helped run a mobile app linked to Trump’s re-election campaign, but there are no reports that it’s working with Digital World Acquisition.

The nearly 40% drop in Phunware shares comes after the company announced that it will sell up to $49.5 million of stock on the open market at currently available prices.

What now
Even former President Trump is not without ambition, but acquiring companies such as Facebook, Twitter and Netflix at the same time could prove difficult for him. Investors are beginning to suppress their expectations in the short term, which could lead to a further decline in the digital world’s acquisition and share price of Phunware.

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