California lawmakers passed a bill that would restrict public officials’ involvement with memecoins, citing concerns over conflicts of interest and what it calls “pay-to-play arrangements.”
According to Legiscan data, the California Senate approved Assembly Bill 2409 in a 40-0 vote on Wednesday. The Assembly then voted 78-0 to concur in the Senate’s amendments. The measure has entered the enrolled stage and is now awaiting the governor’s signature.
What the bill would do
The bill would prohibit digital asset service providers from offering California residents memecoins issued on or after Jan. 1, 2027, when those tokens are offered by, or in partnership with, federal public officials or state or local public officers.
It defines memecoins as digital assets whose value is derived primarily from public interest, speculation or community engagement.
As described in the report, the measure also seeks to block the listing to California residents of memecoins issued by federal public officials, framing the issue around conflicts of interest and “pay-to-play arrangements.”
TRUMP token cited in the broader debate
Public Citizen, a nonprofit consumer advocacy organization, said in a Thursday report that investors in the president-linked Official Trump (TRUMP) memecoin are estimated to be $3.2 billion underwater. Most of those losses, the report said, remain unrealized.
CoinMarketCap data cited in the article shows TRUMP as the fifth-largest memecoin by market capitalization, at $688 million. The token rose 53% over the past week, recovering part of the losses from its 67% decline over the past year.
Wider political and legislative backdrop
The article also says the Trump family’s crypto ventures have created obstacles for the passage of the Digital Asset Market Clarity (CLARITY) Act, a US crypto market structure bill.
A bipartisan ethics addendum that has not been made public would reportedly allow Trump to defer capital gains taxes on any required divestitures, which could produce tax savings in the millions.