1-3-2025 – The Securities and Exchange Commission (SEC), has officially determined that so-called “meme coins” fall outside the remit of securities regulation.
The regulatory body issued guidance on Thursday affirming that these digital currencies—typically inspired by internet humour and viral content—do not constitute securities under federal law. This pronouncement effectively liberates participants in the meme coin ecosystem from the registration obligations that typically encumber securities transactions.
“Akin to collectibles,” the SEC’s Division of Corporation Finance wrote, these digital tokens operate primarily on speculative trading and collective sentiment rather than functional utility. The statement draws parallels between meme coins and traditional collectible items whose value exceeds their intrinsic worth due to cultural significance or popular appeal.
Purchasers should note, however, that this classification bears a significant caveat: the absence of securities designation means these assets operate without the protective framework afforded to regulated investments. The volatility characteristic of meme coins—coupled with their typical acknowledgement of risk and limited practical application—places them in a distinct category from conventional financial products.
This official position aligns with earlier comments from Commissioner Hester Peirce, who leads the SEC’s recently established Crypto Task Force. In previous discussions with Bloomberg, Peirce suggested that many meme tokens likely fall beyond the Commission’s regulatory scope, potentially finding regulatory oversight instead with the Commodity Futures Trading Commission (CFTC).
The statement carries particular significance for the originator of the meme coin phenomenon, Dogecoin, and its numerous derivatives. These projects began largely as entertaining experiments rather than serious investment vehicles, with market dynamics driven predominantly by community enthusiasm and speculative interest.
Venture capitalist David Sacks recently offered a comparable assessment, likening both non-fungible tokens and meme coins to traditional collectibles such as stamps or baseball cards—items purchased primarily to commemorate moments or movements rather than generate functional returns.
