Digital Assets: Clarity on Stablecoins and Meme Coins (Part II)

Digital Assets: Clarity on Stablecoins and Meme Coins (Part II)

Under former SEC Chairman Gary Gensler’s regime, even stablecoins were alleged to be securities as seen in SEC v. Binance Holdings Limited, et al, although the District Court swiftly dismissed the case. In anticipation of a changing regulatory landscape, Ripple Labs’ stablecoin, RLUSD, which is backed 1:1 to the U.S. Dollar in the form of USD deposits, short-term U.S. Treasury bonds, and other cash equivalents gained approval by the New York Department of Financial Services (“NYDFS”).

Per the March Executive Order, the President’s Working Group progressed plans for a “Crypto Strategic Reserve that includes XRP, SOL, and ADA”. Shortly after, on March 20, 2025, the President stated at the Digital Assets Summit that he “called on Congress to pass landmark legislation creating, simple, common-sense rules for stablecoins and market structure”. Shortly after, World Liberty Financial announced the launch of their stablecoin, USD1, which will also be backed by short-term U.S. government treasuries, U.S. dollar deposits, and other cash equivalents. On June 17, 2025, the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act was passed, establishing a federal framework for dollar-pegged stablecoins.

The SEC released a Staff Statement on Meme Coins, stating that meme coins do not involve the offer and sale of securities according to the Howey test, as purchases of meme coins do not constitute an investment, citing speculative trading and sentiment as primary value drivers rather than the promoter’s managerial or entrepreneurial efforts, thereby making profit unreasonable.

Overall, the March Executive Order, the President’s legislative appeal for stablecoin legislation, the passage of the GENIUS Act, and the SEC’s clarification of meme coins point toward a significant pivot in U.S. digital asset policy.

As the Working Group on Digital Asset Markets continues developing the regulatory framework for digital assets, Compliance Exchange Group remains vigilant on adapting and being prepared to present the framework needed to become a registered Broker-Dealer when you start a crypto exchange.