Elizabeth Warren and Richard Blumenthal want the SEC to look into whether the $TRUMP memecoin amounts to an illegal scam. The two Democratic senators fired off a letter to the agency this week, leveling what they call a "soft rug pull" accusation, marking their most aggressive move yet against Trump-linked crypto ventures.
The challenge facing the senators is straightforward: the SEC already ruled in February 2025 that memecoins don't qualify as securities. That decision essentially strips the agency of the regulatory tools it would typically deploy to investigate such schemes. Paul Atkins, the SEC chairman appointed by Trump, would need to take action anyway, which remains unclear at best.
A year-long push on Trump family finances
Warren and Blumenthal have spent the last two years digging into income flowing from crypto to the president, his family, and officials close to the administration. They've sent letters, demanded hearings, and requested documents about deals that sparked their concern. In April, Senator Adam Schiff joined them pushing to expose details of a Trump memecoin gala at Mar-a-Lago where a dinner with the president was the main draw. By June, three additional senators signed on to demand due diligence on a $500 million World Liberty Financial deal between the Trump family's DeFi project and a state-linked UAE partner.
The memecoin itself launched amid a storm of activity around Trump's crypto interests. The senators view the token's structure and how profits flowed as evidence of a coordinated scheme designed to benefit the inner circle while leaving other investors holding the bag. Whether regulators will pursue the matter depends largely on how they interpret their own authority in the memecoin space, a jurisdiction question that's still unsettled.
This is reporting on political and regulatory developments. It is not investment advice, and nothing here should be construed as guidance on cryptocurrency purchases or holdings.
