California Cripples Politicians' Ability to Launch 'Meme Coins'
California has become the latest state to introduce regulations on meme coins after Governor Gavin Newsom signed AB 2409 into law. The bill, which takes effect on January 1, 2027, prohibits state officials and certain government employees from creating meme coins with a political focus.
The new law is part of a broader package of bills aimed at strengthening oversight of government officials, protecting consumers, and combating crimes involving digital assets. AB 2409 specifically targets the creation and promotion of 'political meme coins' issued by public officials or in collaboration with them.
The move comes in response to high-profile cases such as the TRUMP and MELANIA meme coins, which saw significant financial losses for investors. The TRUMP token was launched on the Solana blockchain in January 2025 and reached a market capitalization of over $10 billion before plummeting by 97.1% from its all-time high.
The new law also includes provisions to combat money laundering through digital assets, facilitate compensation for victims of cryptocurrency fraud, and establish mechanisms for seizing digital assets in transnational criminal networks.