Warren, Auchincloss Investigate Trump Meme Coins; Raise Concerns about Consumer Ripoffs, Foreign Influence-Peddling, Conflicts of Interest
“This meme coin could hurt the very people President Trump says he is working to help”
“Anyone, including the leaders of hostile nations, can covertly buy these coins, raising the specter of uninhibited and untraceable foreign influence over the President of the United States, all while President Trump’s supporters are left to bear the risk of investing in $TRUMP and $MELANIA”
Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs, and Representative Jake Auchincloss, Member of the House Committee on Energy and Commerce, wrote to the United States Office of Government Ethics (OGE), The Department of the Treasury, the Securities and Exchange Commission, and the Commodity Futures Trading Commission on how they will address the unprecedented concerns posed by the launch of the $Trump and $Melania meme coins, including the threats from consumer ripoffs, corruption and foreign influence, and President Trump’s conflicts of interest.
On Friday, January 17th, President Trump launched a meme coin, $TRUMP, for less than $10 per coin. By Sunday, the price of $TRUMP reached approximately $75 per coin, before falling to $33.88 on Monday. On Sunday, First Lady Melania Trump launched her own meme coin, $MELANIA, which was launched at $7, increased in value overnight to $12, and has since dropped to $4. Nearly overnight, President Trump and his wife’s net worth skyrocketed to $58 billion. Richard Painter, the top ethics lawyer for the George W. Bush Administration said it was very “dangerous to have the people who are supposed to oversee regulating financial instruments investing in them at the same time.” Norm Eisen, former White House ethics adviser in the Obama Administration, noted that the launch of the meme coins “represents the single worst conflict of interest in the modern history of the presidency.” Even some in the crypto industry have raised concerns about these coins, calling them “grifty” and a “mockery.”
President Trump and his associated business entities that own 80 percent of $TRUMP could dump their coins over the course of a three-year period, generating huge sums for themselves while crashing the price of the coin for his supporters left holding the bag. To make matters worse: the terms and conditions of both $TRUMP and $MELANIA purport to ban consumers from seeking relief for any fraud-related claims and prevent purchasers from joining class action lawsuits against the coin or its issuers.
The meme coins also open the door to secretive foreign buyers seeking to curry influence with the administration—and the possibility of foreign emoluments clause violations. Anyone in the world can buy these coins, raising concerns about the coins’ use by foreign individuals and governments to buy influence over President Trump and his family.
Warren and Auchincloss questioned the agencies on the ethics rules surrounding the launch of the meme coin, how they will track and identify purchases of these coins, whether current law prevents foreign actors from purchasing these coins and enriching President Trump, and what authorities the SEC and CFTC have to address the threats posed by these coins to retail investors and consumers.
Previous Article