Investors of Memecoins should be aware: SEC intervention discontinued
No More SEC Safe Haven for Meme Coins
Get ready for the Wild West, investors! The U.S. Securities and Exchange Commission (SEC) is throwing in the towel on policing memecoins, leaving you to navigate the choppy waters all on your own.
Because let's face it, even Hester Peirce thinks you're on your own. She's made it clear that popular memecoins like TRUMP won't be getting any protection from the SEC – no help with fraud, no shield from price manipulation, nada. In her words, "you're on your own, suckers!" Well, maybe not quite those words, but you get the gist.
Peirce explained their stance – memecoins don't meet the legal muster for SEC scrutiny. Simple as that. she shrugs and proclaims, "don't expect any help from us." The SEC will only step in if securities laws are being flat-out violated.
Trump's Token Stirred the Pot
Remember when Trump launched his $TRUMP token before he even became president? February 2025 – the SEC declared that memecoins like TRUMP wouldn't be classified as securities. That announcement caused a stir, especially among Democratic senators like Richard Blumenthal, who voiced concerns about potential financial and ethical issues – and the possibility of foreign actors meddling in U.S. politics. Oy vey!
Banks Throw Their Hat in the Crypto Ring
And now, things are getting even wilder! The SEC just scrapped Staff Accounting Bulletin 121, which kept banks from offering crypto storage services. Peirce wasn't happy about it, calling it a "sham law," and noting it was imposed without a public discussion.
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Enrichment Data
In essence, here's the dealio with SEC regulations on memecoins like TRUMP:
- Classification as Non-Securities: The SEC has officially declared that meme coins, including tokens like TRUMP, don't fall under the U.S. securities law classification. This was reaffirmed in February 2025 and again in May 2025, marking a retreat from regulating this sector.
- Unsupervised Investing: Without SEC classification, meme coins skate by without the same level of regulatory oversight. That means investors are on their own, taking on the risky waters of meme coin trading without the usual SEC safeguards.
- Policy Shift: The SEC's decision indicates a broader shift in their crypto regulation policy, seen as a more lenient approach towards the crypto industry – even if it raises some eyebrows re: the Trump family's involvement.
Investors must prepare for an unregulated landscape as the SEC opts not to monitor memecoins like TRUMP, leaving them to navigate the volatile market on their own. Furthermore, with the deregulation of banks entering the crypto storage service sector, the Wild West of finance and investing is expanding, calling for more cautious and independent approaches from investors.
