California Just Made It Illegal for Officials to Launch Memecoins

TLDR

• Governor Gavin Newsom signed AB 2409, banning California public officials from issuing memecoins.
• The law also blocks crypto platforms from listing certain official-linked memecoins issued after Jan. 1, 2027.
• Newsom signed a second bill, SB 1208, expanding money laundering rules to cover digital assets.
• Newsom tied the new law to criticism of President Trump’s memecoin business and its investor losses.
• The law uses civil enforcement, allowing California’s attorney general and local prosecutors to seek injunctions.

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California Governor Gavin Newsom has signed a new law stopping public officials from issuing memecoins. The bill, called AB 2409, was signed on Sept. 27. It takes effect for tokens issued on or after Jan. 1, 2027.

BREAKING: 🇺🇸 California Governor Newsom just banned public officials from launching memecoins. pic.twitter.com/pgPoQrxFPJ

— Ash Crypto (@AshCrypto) September 27, 2026

The law applies to state and local elected officials. It also covers appointed officials, state legislators, and members of government boards and commissions.

A smaller group of government employees is also covered. This includes those with authority over government bids and contracts.

What the Law Actually Bans

Under the law, these officials cannot issue a memecoin. Issuing means making a token available for public purchase, donation, or exchange of value.

The law does not ban memecoin trading in general. It also does not force platforms to remove existing political tokens that were issued before 2027.

Instead, it targets future token listings. Starting Jan. 1, 2027, digital asset platforms cannot list a new memecoin if it is offered by, or made in partnership with, a covered public official.

This applies to platforms serving California residents. Earlier drafts of the bill focused on tokens using an official’s image or likeness, but lawmakers changed that language before the final vote.

The bill passed with no recorded opposition. The Assembly approved it 77-0 in May, and the Senate approved it 40-0 in August.

Newsom Links Law to Trump’s Memecoin

Newsom used the bill signing to criticize President Donald Trump’s crypto business. Trump launched his own memecoin in 2025.

“No official should profit off their office,” Newsom said in his signing statement.

The governor’s office pointed to reports that around one million buyers of the Trump-linked token lost a combined $3 billion. At the same time, Trump earned hundreds of millions of dollars connected to the token.

Government ethics filings show Trump reported $635,068,835 in royalties tied to a licensing deal connected to the memecoin business. This figure reflects royalties, not the current market value of any tokens.

Separate blockchain data reviewed by crypto.news found close to 989,000 wallets holding a combined $3.81 billion in unrealized losses, based on July 2026 figures. The White House has said Trump’s business dealings do not create conflicts of interest.

How the Law Will Be Enforced

AB 2409 does not create a new criminal charge. Instead, it allows civil enforcement.

California’s attorney general can file a civil action against violators. The law also allows district attorneys, city attorneys, and county counsel to bring similar cases.

Courts can order an injunction to stop the activity. They can also order the person to give up money made from the memecoin.

A Second Law Targets Crypto Crime

Newsom also signed SB 1208 on the same day. This law expands California’s money laundering statute to include digital assets.

The law lets law enforcement freeze, seize, and forfeit crypto tied to crimes. Agencies can send a freeze request to an exchange, and the exchange must hold the assets for 10 days while a warrant is obtained.

Seized assets can stay in law enforcement custody for up to three years while victims file claims. After that, leftover assets go into California’s Restitution Fund for victim services. This part of the law runs through Jan. 1, 2032.

Both laws were part of a wider package covering crypto crime and public ethics rules signed by Newsom this week.