The U.S. Securities and Exchange Commission is officially stepping back from regulating memecoins, essentially leaving investors on their own when it comes to volatile tokens like $TRUMP — a memecoin closely tied to President Donald Trump and his expanding crypto empire.
In comments this week, SEC Commissioner Hester Peirce made it clear that the agency does not view these tokens as securities and will not offer guidance or protection to traders.
The move underscores a dramatic shift in Washington’s approach to crypto under Trump, whose own token soared to a $15 billion market cap earlier this year before crashing. With 80% of $TRUMP reportedly held by Trump-affiliated entities, critics warn that the business has glaring conflicts of interest — and a regulatory vacuum as the president’s family profits from a financial product now officially outside the SEC’s reach.
Peirce compares meme coins to NFT market dynamics
In an interview with CNBC, Peirce compared the current meme coin situation to the 2021 non-fungible token (NFT) boom. She noted that while NFTs weren’t classified as securities, they still experienced major price fluctuations driven by market speculation. The commissioner suggested the SEC missed an opportunity to provide clearer public guidance during that period.
“Here was something where I saw a lot of interest in this out in the world — in meme coins — and it made sense for us to say, ‘People if you are expecting that there’s SEC protection around these, you should not expect that,’” Peirce said.
The commissioner emphasized that while virtually any asset can be structured as a securities transaction, investors should understand that meme coins operate outside traditional regulatory safeguards. Her message to market participants was clear: proceed with full awareness of the risks involved.
Since Trump’s inauguration, the SEC has adopted a different approach to cryptocurrency enforcement. The administration has moved away from the aggressive regulatory stance of the previous leadership.
Democratic lawmakers, including Senator Richard Blumenthal of Connecticut, have raised concerns about potential conflicts of interest that stemmed from the Trump family’s crypto holdings.
Peirce defended the agency’s changing approach and cited the absence of clear regulatory frameworks during earlier enforcement actions. “We didn’t have a clear set of rules,” she explained.