Former president Donald Trump's pledge to retain his 60% stake in Trump Media & Technology Group gave the company's shares a much-needed boost on Friday. However, on Monday, the stock took a hit, slipping 4% in early trading. The company, which owns Truth Social, has seen a significant decline of 77% since its peak in March, raising concerns among investors.

Despite Trump's reassurance about holding his shares, Trump Media continues to face challenges, including the imminent expiration of the lock-up period on September 19. This period has prohibited insiders, including Trump, from selling their shares. While Trump has vowed not to sell, other insiders have the opportunity to reduce their stakes, potentially impacting the stock's price.

Lock-up periods are commonly utilized during initial stock offerings to prevent major investors and insiders from rapidly offloading their shares, which can lead to significant market volatility. Trump attributed the months-long stock decline to the impending expiration of the lock-up, stating that many people believe he will sell his shares, thus affecting the stock value.

However, it is important to note that other insiders, such as Trump Media CEO Devin Nunes, Donald J. Trump Jr., and former Trump administration official Daniel Scavino Jr., will be able to sell their stakes once the lock-up ends. Regulatory filings indicate that at least 9 insiders will have the freedom to sell their shares after September 19.

Trump Media has not provided any information about the plans of these insiders regarding their shares once the lock-up expires. The lock-up period was initially set to last for six months after the company went public in March, with the expiration date scheduled for September 26. However, if certain conditions are met, such as maintaining a share price above $12, the lock-up can end earlier.

The expiration of the lock-up period presents an opportunity for DJT insiders to liquidate some of their positions. However, it also carries the potential for heightened volatility in the stock. According to the company's registration statement, insider sales could increase trading price volatility or exert significant downward pressure on the stock price.

Analysts have drawn comparisons between Trump Media & Technology Group and meme stocks, which are driven by social media buzz rather than standard financial metrics. The company's performance has also reflected Trump's political and financial fortunes, with shares initially surging after an assassination attempt on Trump in July. However, these gains were short-lived, and the stock has since declined by 57% as investors reassessed Trump's chances of reclaiming the presidency with Vice President Kamala Harris entering the race.

In addition to the challenges posed by the expiration of the lock-up, Trump Media is grappling with operational difficulties. The company reported a 30% decrease in second-quarter revenue compared to the previous year, amounting to $836,900. However, there was a slight improvement in losses, with a reduction to $16.4 million from $22.8 million in the same period last year.

As the lock-up expiration date approaches, the future of Trump Media & Technology Group remains uncertain. The actions of insiders and market forces will likely determine the company's trajectory in the coming weeks.