What It Means for Crypto
The SEC’s Pro-Crypto governance has begun taking action on cryptocurrencies, but this time, it’s permanent. The Securities and Exchange Commission made it clear Meme CoinLike Trump and other popular tokens, securities or investments are not considered to be required to comply with strict financial rules. Instead, the agency makes them more of a collectible—people buy for entertainment rather than as real financial assets. But just because meme coins are not regulated as much as stocks, doesn’t mean that fraudsters can get rid of fraud. The SEC warns that if someone uses meme coins to mislead people or scam them, they will still have legal trouble.
Meme Coin: Not a Securities
According to the latest SEC statementMeme coins do not comply with the legal definition of securities in the Securities Act of 1933. Unlike stocks or investment contracts, Meme Coins does not provide holders with any rights to future profits, income or ownership of the company. Therefore, the SEC does not require meme coin creators or traders to register with them, meaning they do not have to follow the same rules as traditional investments. However, this also means that investors do not get the usual protection from the SEC, putting them at risk of fraud, pumping plans and misleading advertising.
Legal experts, including Khurram Dara of Bain Capital Crypto, stress that even if the SEC cannot directly regulate meme coins, other federal or state agencies can take action against deceptive practices to protect investors.
A new bill emerges
House Democrats were already pushing the Modern Emergency and the Malice Enforcement (MEME) bill to limit public officials to launch or endorse meme coins. The bill, led by California representative Sam Liccardo, is in response to Donald Trump’s controversial “Trump’s meme coinwhich causes the value to rise and fall sharply. Legislators fear that such tokens may be used for personal or political gain, causing moral issues.
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The SEC’s position triggered a mixed reaction in the encrypted space. Some industry participants see this as a positive move, believing that regulatory clarity will encourage more investment in meme coins, especially in U.S.-based coins. Blockchains like Solana. Crypto lawyer Ishmael Green pointed out that external securities laws officially emerged with the help of Meme coins, and communications such as Coinbase and Robinhood may feel more confident, which may lead to a surge in market activity. After the announcement, stocks on major crypto exchanges rose slightly, reflecting optimism within the industry.
At the same time, it is surprising SEC is revoking lawsuits Oppose Coinbase, Consensys and Gemini, indicating positive changes in crypto assets.
With the imminent meme behavior and the SEC convert gear, the regulatory scenarios for cryptocurrencies (especially meme coins) are changing rapidly. Whether these changes bring more clarity or confusion remains to be seen.
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