Is Donald Trump’s Meme Coin Legal? Limits of Presidential Power and Norms Are Being Tested, Experts Say

It’s been less than a week since President Donald Trump launched his own meme coin on the eve of his inauguration—and yet, in crypto, it’s felt like half a lifetime. 

Though he’d embraced crypto in numerous ways, Trump—arguably the most famous person on Earth—suddenly shilling his own meme coin, while ascending to (arguably) the most powerful position on the planet, broke a few brains and fried several more. 

That the president may have just enriched himself to the tune of several billion dollars while serving in office appeared to surprise many, including the president himself. When asked earlier this week about the meme coin, Trump said he “didn’t know much about it other than I launched it” and “heard it was very successful.”

Many have asked this week, some in giddiness, others in despair: How could this be happening? More to the point: Is something like this even legal? 

Decrypt posed the question to legal experts and researchers of presidential power, who all agreed: Like it or not, the cat’s out of the bag. And at this point, there are few ways to put it back in—if anyone even wanted to try.

American presidents, generally speaking, are afforded incredible amounts of discretion and power while in office. Thanks to a groundbreaking ruling by the U.S. Supreme Court last summer, they apparently retain much of that immunity after leaving office, too.

Presidents are not subject to the same laws and regulations as everyday citizens, nor are they obligated to comply with the disclosures and conflict of interest requirements designed for their cabinet appointees. Most of the norms governing the U.S. presidency are just that—norms. 

Launching a meme coin, it’s safe to say, is pretty abnormal behavior for a commander-in-chief. But there are no existing U.S. laws explicitly outlawing a president from doing so. 

“The irony is, we don't know for sure what is legal and what isn't legal here, because the Biden Administration essentially declined to tell us,” Brian Frye, a law professor at the University of Kentucky, told Decrypt. 

Famously, the former Democratic president did not establish any legal frameworks for overseeing digital assets, opting instead to encourage the SEC to sue crypto firms sporadically via an effective policy of “regulation by enforcement.” 

Before launching a meme coin, Trump was already poised to usher in a far more permissive regulatory environment for crypto. But now, Frye said, it would appear that the president’s creation of a meme coin has, as a practical matter, de-facto legalized such activity.

“It seems like it'll be awfully difficult for the SEC to go after someone else for doing the same thing that the president has done or is currently doing,” he said. 

Cheryl Isaac, an attorney specializing in the regulation of digital assets at K&L Gates, told Decrypt she’s confident that meme coins have already proven themselves to be commodities squarely under the jurisdiction of the CFTC, and thus free from the SEC’s far more stringent oversight.

Under the CFTC’s supervision, the mere act of creating a meme coin would not risk scrutiny, Isaac said. Only if a meme coin’s creator made promises about a token’s future price, or failed to fork over tokens after receiving payment for them, would the agency get involved.  

“The CFTC is not focused on what the product is or isn't doing,” she explained. “It's focused on how market participants are being protected from bad acts related to those products.”

Trump has neither made promises about his meme coin’s future value nor prevented investors from receiving their owed allotments of the token. Further, putting presidential immunity aside, the CFTC’s definition of a conflict of interest is incredibly narrow—tailored more to preventing a financial exchange from launching its own products, for example. 

That hasn’t stopped some from trying to investigate the matter. On Thursday, Sen. Elizabeth Warren (D-MA), a prominent crypto critic, sent a letter to several federal regulators requesting investigations into Trump’s meme coin launch, as well the creation of a new crypto token by his wife, First Lady Melania Trump. 

It may prove difficult for those investigations to bear any legal fruit. But that doesn’t mean Trump’s meme coin antics aren’t cause for ethical concern.

Richard Briffault, a legal scholar at Columbia University and a leading expert on government ethics, said that Trump’s new token poses a massive opportunity for political actors worldwide seeking to line the president’s pocket. 

“It creates a serious ethical problem, in that he's basically in a position where people who want to win the favor of the government can buy his coin,” Briffault told Decrypt. “It's as if he's inviting people to give him a gift.”

Last month, Justin Sun, a controversial crypto founder facing allegations of fraud in the U.S., gave millions to another of Trump’s crypto projects, World Liberty Financial. 

Within crypto, tech leaders have started speaking out about the ethical implications of politicians launching their own crypto products. Ethereum co-founder Vitalik Buterin disparaged meme coins created by world leaders like Trump as “perfect bribery vehicle[s].”

While Columbia’s Briffault acknowledges that previous U.S. presidents have greatly expanded the power of the office—for example, by going to war without congressional approval—he says the implications of Trump’s crypto activity are unprecedented. 

“I'm not aware of any president who has done so much to basically boost his own bank account, and that of his family,” Briffault said. “It’s a whole different order of problem.”

Barring an intervening act of Congress—which is essentially unthinkable for now, given Republican control of the chamber—the scholar said little can be done about the current state of affairs. 

Does that mean that if Trump has created some sort of ethical crisis with his crypto dealings, the problem will end when he departs the White House for good in 2029? 

Briffault is skeptical. A new presidential norm may have just been established. 

“It’s very rare that a president gives back power,” he said.