Warren and Blumenthal Demand SEC Probe into Trump Meme Coin
Senate Democrats Elizabeth Warren and Richard Blumenthal have sent a letter to the Securities and Exchange Commission (SEC) requesting an investigation into President Trump's meme coin, which they believe may be a 'rug pull.'
A rug pull occurs when investors raise funds from the public through token sales only to shut down the project or disappear with the raised tokens. The senators are concerned that the $TRUMP coin follows this pattern after launching just prior to Trump's inauguration and reaching its peak value of about $9 billion on January 19, 2025.
The coin is now worth less than $400 million, a decline of 97 percent from its peak. The senators argue that this sharp depreciation warrants an investigation into whether a fraudulent scheme may be underway.
Trump has defended his crypto profile, stating that he doesn't get involved in personal investments and that funds run by his sons manage his money. However, the SEC's past actions against blockchain engineer Eric Zhu for a similar 'rug pull' scheme suggest that meme coins can be subject to investigation.