Meme coin investors should realize that the U.S. Securities and Exchange Commission (SEC) will not help them even if they lose money, SEC Commissioner Hester Peirce said on Friday on CNBC, clearly stating that meme coins are outside the SEC's regulatory scope.
According to Bitcoin.com News on the local date, Commissioner Hester Peirce said on Friday on CNBC that meme coin investors should realize that the SEC will not help them even if they lose money.
Peirce, who was appointed by crypto-friendly President Donald Trump in 2018 and leads the newly established SEC Crypto Task Force, mentioned, "Generally, people know better, and I do not expect SEC protection in this area (meme coin investment)."
Peirce's recent statement is a reiteration of her statement in February, when she said, "Many meme coins there probably will not have a place at the SEC under our current set of regulations."
At the time, Peirce noted that the SEC does not consider most meme coins as securities and emphasized the need for clear legislative guidelines defining the SEC's regulatory scope. She also stated that the Commodity Futures Trading Commission (CFTC) might be more suitable to regulate such assets.
In an interview at Bitcoin 2025, Peirce mentioned that while it is possible to "package almost everything as a securities trade," most meme coins do not fall into that category. Therefore, meme coins are outside the SEC's regulatory authority. She added, "Here, I saw a lot of interest in the world about this, in meme coins. And it was reasonable to say, 'People, if you expect SEC protection around these, you should not expect that.'"
Peirce compared the increasing interest in meme coins with no intrinsic value to the interest in Non-Fungible Tokens (NFTs). Like meme coins, most NFTs saw their value significantly drop after initial interest faded.
Peirce's statement aligned with the White House Crypto Czar David Sacks' suggestion to treat meme coins as collectibles.
The Official Trump meme coin soared to a market capitalization of $30 billion just before his inauguration and then immediately plummeted. Small investors of the meme coin reportedly lost $2 billion when the TRUMP price crashed.
However, Trump-related organizations controlling over 80% of the meme coin supply earned at least $100 million in transaction fees by January 30. Similarly, insiders reportedly invested a few hours before the release of First Lady Melania Trump's meme coin and earned around $100 million.
Trump's deepening relationship with the cryptocurrency world raised conflict of interest concerns, as a sitting president could benefit from his own policies. Trump also caused significant controversy by hosting a gala dinner for the top 220 meme coin holders earlier this month.
Several representatives received mixed reactions, with half claiming the gala dinner was a way for foreign companies and investors to approach Trump. However, the White House dismissed all conflict of interest claims.
Peirce's statement indicates that investors who lose money with tokens cannot expect any support or guidance from the SEC. In other words, the SEC has distanced itself from meme coins increasingly used by bad actors for fraud and rug pulls, and investors must defend themselves.
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