SEC commissioner warns Memecoin investor: “You are on your own. No security net”
- The second will not regulate memoins and warns investors that they are not protected by securities law.
- “Crypto Mom” Hester Peirce calls for personal sense of responsibility, because the SEC will not regulate Memecoins without a clear congress order.
The US stock exchange supervision SEC has made it clear that it is not responsible for the continued decline of the Trump coin, even if investors have to accept high losses. At the 2025 Bitcoin conference, SEC Commissioner Hester Peirce said that meme coins did not fall within the regulatory framework of the authority.
Commissioner Peirce, who is also referred to as crypto mom because of her support for decentralized innovations, explained that buyers of meme token have to recognize the lack of investor protection. During her appearance in Las Vegas emphasized she that Memecoin investors should be aware that they are not protected by securities law. She expressly said that there would be no support from the SEC and no recourse claims even with spectacular losses.
Crash of the Trump coin triggers reactions in the industry and politics
The Trump token based on Solana was introduced in January 2025 and rose to $ 75 in a few days. His branding and his direct connection with President Donald Trump triggered concern with democratic MPs and some crypto analysts.
The sudden increase in the token, followed by an equally sudden breakdown, led to allegations that the project was a pump-and-dump, benefited from the insider while small investors remained unprotected. In addition, the White House has contested all allegations of participation and any misconduct. Hester Peirce made it clear that political affiliations do not determine the limits of the SEC in regulation. The SEC, she emphasized, will only intervene if an asset or sale falls under the securities law.
In her explanations, Peirce made it clear that the regulation of Memecoins requires the congress measures. One could found a special Memecoin commission to react to the Berchtigetn interests of investors on these tokens. She emphasized however that the SEC will not initiate such a step on its own. According to Peirce, every expansion of the powers in this area would require a guideline of the congress.
Her statements coincide with an earlier interview in February, in which she explained that most memoins, including the Trump token, do not comply with the legal definition of securities and do not fall within the area of responsibility of the Commission.
SEC pulls the border between assets and the offer context
Peirce defended the limited scope of the Commission in relation to Memecoins, but noted that certain digital assets could nevertheless fall under securities law depending on their marketing and sales. She explained:
“If an issuer sells an asset in a way that is equivalent to a securities offer, the transaction can fall under the second supervision, even if the asset itself is not a securities.”
She also warned that with the increasing interest in the tokenization of traditional shares and bonds, more digital assets could be subject to securities classification.
The decision of the SEC, her complaint against Binance and his ex-CEO Changpeng Zhao withdrawunderlines this attitude. Some analysts see this step as part of a more comprehensive revision of the Commission’s crypto strategy, which criticizes that there were lack of consistency and clarity.
While the SEC continues to deal with the complexity of cryptor regulation, Peirce sent a clear message to Memecoin investors and made their personal responsibility for their decisions.
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