Crypto industry advisers were keen to push ahead with legislation at a meeting with lawmakers Wednesday but shied away from one topic: President Donald Trump’s meme coin launch and digital asset ventures.
All agreed that regulating the fast-moving space was necessary but when pressed at a U.S. House Financial Services Committee on Trump’s potential conflicts of interest, speakers were quick to skirt the issue.
The hearing aimed to clarify regulatory and other issues related to the burgeoning digital assets industry. But questioning from Democratic and more pro-crypto Republicans reflected the differing attitudes toward crypto between the two major U.S. parties. Democrats took particular issue with Trump’s personal crypto initiatives, which have raised concerns about his using his position to advance his business goals.
Ahead of his inauguration, President Trump launched a meme token—Official Trump—which shot up in value before crashing hard.
“As Americans wonder how they will afford retirement or afford groceries, Trump is sitting pretty,” Maxine Waters (D-Calif.) said at Wednesday’s meeting.
“We need to stop Trump before he takes any steps further on crypto legislation,” she continued, claiming President Trump had doubled his wealth via various crypto ventures over the past year.
Alexandra Thornton, senior director of financial regulation at the Center for American Progress, said she could not comment on the President’s business ventures but added that fraud still existed in the space.
Rep. Stephen Lynch (D-Mass.) asked Rodrigo Seira, special counsel at Cooley LLP, if there was a problem with President Trump’s meme token launch and the asset’s subsequent price crash.
Seira refused to comment on any specific project.
Lynch added: “It is also notable that under the Trump administration, the SEC has dropped almost every lawsuit against some of the worst offenders in the crypto industry.”
Trump’s Solana-based token, TRUMP, is now nearly 89% down from its January high.
Some members of the Democratic Party have argued that President Trump is too involved in the crypto space and is unfairly making money.
Lawmakers are currently deciding how best to move forward with regulating stablecoins: digital tokens pegged to the U.S. dollar and other non-volatile assets.
Trump campaigned as a pro-crypto Republican to help the digital asset space, and received funding from crypto entrepreneurs and Silicon Valley bigwigs.
The president has backed a DeFi project, and the Trump family has launched a stablecoin, the World Liberty Financial USD1 token.
Since Trump took office, regulators have taken a different approach to the Securities and Exchange Commission’s prior tactics of hitting major crypto companies with lawsuits.
Financial watchdogs have scrapped cases against Kraken, Coinbase, Robinhood, and others.
The SEC has also launched a new task force under commissioner Hester Peirce, and rescinded its Staff Accounting Bulletin (SAB) No. 121, which required companies to record a liability and a corresponding asset for crypto assets held on behalf of users.
Critics, including Peirce, argued that the guidance added unnecessary complexity and created an uneven playing field for crypto platforms.
In February, the regulator said that meme coins and tokens did not fall within its jurisdiction.
Edited by James Rubin
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