U.S. Senators Elizabeth Warren (D-MA) and Richard Blumenthal (D-CT) urged the U.S. Securities and Exchange Commission (SEC) on Aug. 4 to investigate President Donald Trump’s memecoin. Their request for an SEC investigation argues the token may have facilitated fraud or unjust enrichment following reports that nearly one million investors lost more than $3.81 billion while Trump-affiliated entities received $636 million.

The senators’ letter states that nearly one million investors lost more than $3.81 billion from the token’s debut through June. Trump-affiliated entities received $636 million, while several early traders secured substantial gains before $TRUMP declined nearly 98% from its peak.

The lawmakers wrote:

“We request that you exercise your authority to investigate the President’s memecoin to detect any illegal fraud or unjust enrichment that the coin may have facilitated.”

The token launched on Jan. 17, 2025, three days before Trump’s inauguration, and the president promoted it on X the following day. The senators argued that Trump-affiliated entities collected trading fees regardless of price performance, separating their financial outcome from the outcomes of retail investors.

Blockchain analyses found that 988,905 buyers, representing about two-thirds of purchasers, held combined losses of $3.81 billion through June. Roughly 500,000 earlier or more sophisticated traders reportedly secured about $4 billion.

A Senate Permanent Subcommittee on Investigations minority staff memorandum collected accounts from investors describing financial losses and feelings of abandonment after the token’s collapse. The document connected those experiences with concentrated ownership, presidential promotion, and potential conflicts.

Warren has previously scrutinized Trump’s cryptocurrency activities, including ethics concerns over a dinner for top $TRUMP holders and potential conflicts involving the administration’s crypto policies. The Aug. 4 letter marks her first request for the SEC to investigate whether the $TRUMP memecoin itself facilitated fraud or unjust enrichment following the reported investor losses.

Meanwhile, public promotion of Trump-branded products continued while hundreds of thousands of wallets remained underwater. A White House video promoted a separate physical commemorative coin while $TRUMP holders collectively faced billions of dollars in reported losses.

The SEC’s Division of Corporation Finance described typical memecoins as speculative crypto assets generally driven by trading demand, online communities, and cultural interest. Typical offerings often fall outside federal securities registration requirements, although specific transactions require individual analysis.

Federal regulators have already pursued conduct resembling activity described by the senators. The SEC charged blockchain engineer Eric Zhu over an alleged liquidity-pool rug pull involving the Game Coin token, claiming he misappropriated approximately $553,000.

New York regulators have also warned that sentiment-based tokens can expose consumers to manipulation and sudden losses. Pump-and-dump activity, rug pulls, wash trading, concentrated ownership, and fraudulent trading platforms were identified among the primary risks.

A consumer guide explains that memecoins often derive value from online attention, celebrity promotion, and speculation rather than underlying utility. Their concentrated supply, sharp volatility, and rapidly changing sentiment can expose buyers to severe losses.

Onchain analysts identified 10.84 million $TRUMP tokens transferred toward Bitgo on July 25, valuing the movement near $16.9 million. Three reported transfers over five months totaled approximately $172.4 million.

Trump-affiliated entities reportedly control about 80% of the token supply through a three-year vesting structure, giving a limited group substantial influence over future circulation. The senators tied that concentration to congressional negotiations over cryptocurrency market structure and restrictions on officials profiting from digital assets.

Warren and Blumenthal wrote:

“As Congress considers crypto market structure legislation, it is critical that Congress and the SEC both do their parts to protect investors.”

The lawmakers asked SEC Chair Paul Atkins to determine whether $TRUMP facilitated fraud or unjust enrichment as Congress develops broader cryptocurrency rules. Any SEC response may affect how regulators approach politically connected memecoins.

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