California's Assembly Bill 2409 would bar state and local public officials from issuing meme coins and, from 2027, stop digital asset platforms from listing official-linked tokens for California residents. The bill cleared both legislative chambers and now awaits Gov. Gavin Newsom's decision.
California lawmakers have passed AB 2409, a bill that would prohibit state and local public officials and certain public employees from issuing meme coins. The Senate passed the bill on Aug. 26. The Assembly then concurred with the Senate amendments in a 78-0 vote.
Officials would be barred from issuing tokens
Under AB 2409, a public officer or public employee could not issue a meme coin. The bill defines issuing as making a token available for public purchase, donation or exchange for anything of value, whether or not it is promoted.
Its definition of a public officer covers state and local elected or appointed officials, including members of the California Legislature, as well as members of advisory boards and commissions. The public employee provision is narrower, applying only to those with decision-making authority over bids and contracts for their entity.
Lawmakers wrote in the bill that officials issuing or promoting financial instruments can create conflicts of interest and opportunities for pay-to-play arrangements, while raising risks tied to exploitation and foreign influence. Assembly Member Avelino Valencia, who introduced the bill, told the Assembly Banking and Finance Committee in April that digital asset platforms had made meme coins easier to create and could let bad actors circumvent existing financial disclosure and conflict-of-interest rules.
Listing restrictions on service providers start in 2027
AB 2409 also targets companies serving California residents. Beginning Jan. 1, 2027, a digital asset service provider could not list for sale, or for purchase by a California resident, a meme coin issued on or after that date when the token is offered by, or in partnership with, a federal, state or local public official.
The restriction does not amount to a general ban on meme coin trading in California — it applies only to the specified category of official-linked tokens issued from that date. An Aug. 21 amendment changed the covered tokens from those bearing an official's likeness to those offered by, or in partnership with, a covered official.
Enforcement runs through civil actions rather than a new criminal offense. California's Attorney General could seek an injunction and disgorgement, and district attorneys, city attorneys and county counsel could enforce the prohibition on officials issuing meme coins.
Trump's token shaped the debate
The Assembly Banking and Finance Committee's analysis specifically discussed President Donald Trump's Official TRUMP meme coin, which he launched shortly before returning to the White House in January 2025. As crypto.news previously reported, Trump reported about $636 million tied to the token, while blockchain analysis cited in that report estimated nearly 989,000 wallets had collectively lost about $3.81 billion by the end of June.
California's bill arrives as federal lawmakers debate similar restrictions, with Sen. Kirsten Gillibrand calling for members of Congress and their spouses to be barred from issuing or promoting meme coins. AB 2409 now heads to Gov. Newsom for consideration.
Source: crypto.news
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