Senators Elizabeth Warren and Richard Blumenthal are calling for the Securities and Exchange Commission (SEC) to investigate President Trump’s memecoin, citing concerns that it may constitute an ‘illegal scam’. The memecoin, which was launched by Trump in 2025, briefly exploded in value before crashing and leaving nearly a million investors facing losses.
Concerns Over ‘Rug Pull’ Scheme
Warren and Blumenthal expressed concern that the memecoin effort could be a ‘rug pull’ scheme, where developers pump up the value of a token and then suddenly vanish with the investor funds. The senators argued that the SEC must investigate whether a fraudulent scheme may be underway and prevent further extraction of enormous value from the hundreds of thousands of investors who put their faith in Trump’s coin.
The Trump coin, which was 80% held by Trump Organization affiliates, reached a peak of about $9 billion in January 2025. However, the coin’s value has since plummeted, leaving investors with steep losses of approximately 97%. The SEC has previously charged a New York blockchain engineer with perpetrating a ‘rug pull fraud’, but it is unclear whether the agency has jurisdiction to investigate alleged rug pulls in the crypto world.
Original reporting: KTVZ (Central Oregon) — read the source article.
