Public Citizen and lawmakers are closing in on Trump’s meme coin windfall — Is the party over?

Public Citizen just threw a legal wrench into Trump’s meme coin empire — calling it a disguised gift and a national security risk. What’s cooking?

Trump’s meme coin gamble under fire

A new controversy is brewing in the crypto world, and at its center is none other than U.S. President Donald Trump.

Within 48 hours, the TRUMP token skyrocketed in value, reaching a staggering $15 billion market cap before crashing to around $3.7 billion as of Feb. 6, marking a significant decline.

According to Public Citizen, on Jan. 20 and 21—after being sworn in as President—Trump took to social media, both X and Truth Social, to repost messages promoting his meme token.

The group argues that because the coin is marketed as a “meme” with no promised value or return, buyers are essentially just giving Trump money, and he is getting “rich”. If that’s the case, this isn’t an investment—it’s a gift, and under the law, that’s a problem.

But there’s a bigger concern that stretches beyond legal technicalities.

The Constitution’s Emoluments Clause prohibits U.S. presidents from accepting money or gifts from foreign governments. With crypto’s decentralized and often anonymous nature, there is no way to verify who is buying Trump’s token.

This, Public Citizen warns, creates a national security risk. If foreign entities are quietly funnelling money to Trump under the guise of meme coin purchases, there is no system in place to detect it — let alone stop it.

A billion-dollar token and a brewing political debacle

Since Donald Trump is the sole beneficiary of this trust, any financial gains from the token — whether intentional or not—ultimately flow directly to him.

On that same day, the total value of his stake in the TRUMP token — 800 million unlocked tokens — was estimated at $42.6 billion based on then-current prices. At its peak price of $75, the valuation of Trump’s stake soared past $62 billion, nearly ten times his declared net worth.

However, as of this writing, the price of the TRUMP token has declined, bringing the estimated value of his stake down to $15 billion.

While significantly lower than its peak, TRUMP token’s valuation remains more than double his net worth, making the financial entanglement between his political influence and personal assets an ongoing point of interest.

And that’s not the only red flag. Reports indicate that 94% of the TRUMP and MELANIA tokens are held by just 40 wallets — a level of concentration that could easily be exploited for insider trading or pump-and-dump schemes.

Legal grey areas and political pressure

At this stage, it remains unclear whether the DOJ or the OGE will take formal action. Historically, sitting presidents have been granted broad leeway in financial matters.

However, this immunity may not extend to actions taken for personal profit while in office. If an investigation finds that Trump personally benefited from meme coin sales while using his presidency to promote them, it could set a legal precedent with far-reaching consequences.

Public Citizen has outlined several possible actions if Trump is found in violation of federal law, including terminating the meme coin’s sale, returning funds to buyers, and pursuing additional penalties.

Meanwhile, Trump’s supporters have largely dismissed the controversy. Some argue that crypto represents a new financial frontier that existing laws do not fully cover, while others see it as just another chapter in the ongoing political battle between Trump and his critics.

The meme coin ‘Wild West’ meets a regulatory reckoning

For years, meme coins have thrived in a chaotic environment where speculation outweighs substance, and viral trends can turn a joke into a billion-dollar asset overnight. But that freewheeling era is running into serious resistance.

Legal challenges are mounting from all directions, and the events of the past few weeks suggest that the screws are tightening on meme coins like never before.

The letter accuses Pump.fun of enabling the creation and sale of tokens that misuse names, logos, and branding without permission. 

One of the targets is Dogshit2, a token allegedly designed to impersonate Burwick Law itself. The firm has demanded its immediate removal or further legal action will follow.

The second, filed on Jan. 30, takes aim at Pump.fun’s operator, Baton Corporation Ltd, accusing them of running a Ponzi-like scheme. 

According to the complaint, Pump.fun collected nearly $500 million in fees while facilitating deceptive token launches that left investors with worthless assets.

The road ahead

The key question is no longer just whether meme coins should exist but who should be held responsible when they raise ethical or legal concerns.

Should platforms like Pump.fun bear responsibility for the tokens launched on them? Should public figures like Trump be allowed to profit from unregulated digital assets without oversight?

If legal actions against both continue to gain traction, they could influence the future of meme coins—not just in how they are traded, but in whether the free-market approach of the past remains sustainable.

As regulatory scrutiny increases, meme coins may face greater oversight than ever before.

Whether they evolve into a more structured, regulated asset class or see restrictions that limit their growth will depend on how these legal battles unfold in the months ahead.