The post SEC Says Meme Coins are Not Securities but Warns of Fraud Risks appeared on BitcoinEthereumNews.com.

Calls are growing for the CFTC to regulate meme coins, with former officials arguing they fall under commodities law. Meanwhile, US lawmakers are pushing legislation to ban public officials from issuing meme coins due to financial exploitation concerns, particularly regarding Trump’s TRUMP and MELANIA tokens, which have suffered major losses.  SEC Rules Out Meme Coins as Securities The United States Securities and Exchange Commission (SEC) clarified that it does not see meme coins as securities, though it warned that fraudulent tokens could still face enforcement actions from other regulatory bodies. The agency’s Division of Corporation Finance stated on Feb. 27 that meme coins do not involve the offer and sale of securities under federal laws and are more similar to collectibles. This means that people engaging in the sale of meme coins are not required to register their transactions with the SEC. Statement from the SEC However, the SEC still warned that meme coin holders will not receive the protections that are usually granted under US securities laws. It also pointed out that any fraudulent issuance or sale of meme coins could still result in enforcement actions from other federal or state agencies. The statement was issued as part of the SEC’s effort to clarify the application of securities laws to digital assets. The statement was made at a time when US President Donald Trump is busy reducing the SEC’s oversight of the crypto sector to fulfill his campaign promises. Last month, the agency also established a Crypto Task Force to create a regulatory framework for digital assets. Trump and First Lady Melania Trump themselves launched meme coins just before reentering the White House on Jan. 20, but this move attracted a lot of criticism from the crypto community and some of Trump’s supporters.  According to the SEC, meme coins…

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Filed under: News - @ February 28, 2025 6:24 am