Trump Media plunges as volatile trading sends social media firm's market value below $5 billion

• Shares of Trump Media plunged as much as 10% on Wednesday. 
• The plunge sent the company's market value below $5 billion for the first time since it went public.
• Donald Trump was bumped from the list of the world's 500 wealthiest people Wednesday, with Forbes now placing him at 699. 

Shares of Donald Trump's social media firm nosedived as much as 10% on Wednesday, dragging the company's market value below $5 billion for the first time since it went public.

Shares of Trump Media and Technology Group were trading at $34.30 per share around 3:20 p.m. in New York, down by 8.5%

The stock has plunged more than 40% month-to-date.

Bloomberg reported a drop in options trading for Truth Social's parent company, with about 70,500 contracts changing hands on Wednesday, a third of the previous 10-day average.

In the wake of Trump Media's Nasdaq debut as "DJT" in late March, its stock surged by as much as 67%, catapulting Donald Trump's wealth to almost $7 billion, as the former president holds a 58% stake in the company. 

However, spasms of volatile trading in the shares have knocked Trump from of the world's 500 wealthiest people, as his personal stake dipped below the $5.8 billion. Forbes now places Trump at 699th globally, with a total estimated wealth of $4.5 billion.

Investors have grown jittery about the company's future in the last week, after Trump Media disclosed a $58 million net loss for 2023 alongside just $4 million in revenue.

As the platform strives to onboard more users, advertisers, and partners, Trump Media indicated in an SEC filing that it foresees continued operating losses and negative cash flows in the near term, along with "material weakness" in its financial reporting controls. Media guru Barry Diller slammed Trump Media as a "scam" last week. 

Then there is the fact that Trump could one day decide to sell his vast stake, either after a lockup expires or if he is granted a waiver by the board, which consists of family and close associates. Trump selling has the potential to tank the share price further.