• The SEC now classifies meme coins as collectibles, not securities requiring registration.
  • The policy change comes one month into Trump's second term.
  • The Securities and Exchange Commission simultaneously dismissed its lawsuit against Coinbase.

The Securities and Exchange Commission issued new guidance on Thursday declaring that most meme coins—cryptocurrency tokens originating from internet memes—are not considered securities under U.S. federal law.

This determination means meme coin holders are not protected by federal securities laws, and those involved in offering or selling these tokens "do not need to register their transactions with the Commission," according to the SEC statement.

The guidance represents a dramatic shift in regulatory approach just one month into President Donald Trump's second term.

SEC Chairman Mark Uyeda, appointed by Trump in January, had previously pledged to establish clearer regulatory boundaries for cryptocurrencies and formed a cryptocurrency task force on his first day in office.

In its explanation, the SEC explained that meme coins typically do "not generate a yield or convey rights to future income, profits, or assets of a business," likening them more to collectibles than securities.

The announcement comes in a politically relevant context, as Trump recently launched his meme coin called $TRUMP shortly before his inauguration.

According to The Telegraph, the coin has lost $12 billion in value since peaking on January 19.

The policy reversal starkly contrasts with the previous SEC approach under former Chairman Gary Gensler, who consistently maintained that crypto tokens, including meme coins, should be treated as securities and urged crypto service providers to register with the Commission.

On the same day, the SEC also announced the dismissal of its lawsuit against Coinbase, the largest cryptocurrency exchange in the United States.

"For the last several years, the Commission's views on crypto have been largely expressed through enforcement actions without engaging the general public," Uyeda stated. "It's time for the Commission to rectify its approach and develop crypto policy in a more transparent manner."

Edited by Annette George