SEC says meme coins are 'akin to collectibles,' not securities

The U.S. Securities and Exchange Commission declared that most meme coins, such as Dogecoin (DOGE-USD) and Shiba Inu (SHIB-USD), are more like collectibles than securities, sparing them from federal regulation but leaving buyers without traditional investor protections, according to new guidance released earlier in the week.

The long-sought clarification comes shortly after President Donald Trump appointed crypto-friendly Paul Atkins as SEC chair to develop a comprehensive and clear regulatory framework from crypto assets. Before Trump took office last month, then-SEC Chair Gary Gensler proposed that meme coins and other crypto tokens should be deemed as securities.

"Meme coins typically are purchased for entertainment, social interaction, and cultural purposes, and their value is driven primarily by market demand and speculation," the regulator's Division of Corporation Finance said in a statement. "In this regard, meme coins are akin to collectibles," it added, as they also "typically have limited or no use or functionality."

In turn, investors participating in the offer and sale of meme coin are not required to register their transactions with the SEC, meaning "neither meme coin purchasers nor holders are protected by the federal securities laws.”

"A meme coin does not constitute any of the common financial instruments specifically enumerated in the definition of ‘security’ because, among other things, it does not generate a yield or convey rights to future income, profits, or assets of a business. In other words, a meme coin is not itself a security,” the Feb. 27 statement said.

With the regulator pivoting toward a softer stance on digital assets under the Trump administration, the SEC dismissed its civil 2023 lawsuit against crypto exchange Coinbase Global (COIN).

Despite the increased regulatory clarity, meme coins dropped with the broader crypto market in Friday morning trading, as looming tariffs drove safe-haven demand.

Other meme coins: Pepe (PEPE-USD), Official Trump (TRUMP-USD), Bonk (BONK-USD), Pudgy Penguins (PENGU-USD), Melania Meme (MELANIA-USD).