California Bans Public Officials From Issuing Meme Coins

California has enacted a law barring state and local public officials from issuing meme coins and restricting crypto service providers from offering certain official-linked tokens to residents.

Gov. Gavin Newsom signed Assembly Bill 2409 on Sept. 27. The measure establishes civil enforcement powers for state and local authorities and targets potential financial conflicts involving public office.

AB 2409 Covers Elected Officials and Some Public Employees

The law prohibits California public officers and covered public employees from issuing meme coins.

Public officers include state and local elected or appointed officials, lawmakers, and members of government boards, commissions and committees, including bodies with only advisory powers. Public employees are covered when they have decision-making authority over government bids and contracts.

AB 2409 defines a meme coin as a digital asset marketed or recognized primarily through its association with internet memes, public figures, fictional characters, cultural phenomena, current events, celebrities or social trends, with value derived mainly from public interest, speculation, or community engagement.

Platforms Face January 1 Cutoff for Official-Linked Meme Coins

The law also restricts digital asset service providers serving California residents. Platforms cannot list for sale or purchase by a California resident a meme coin issued on or after Jan. 1, 2027 when it is offered by, or in partnership with, a federal public official or a California state or local public officer.

That provision extends beyond California officeholders because qualifying tokens linked to federal officials also fall within the restriction when offered to California residents. AB 2409 does not establish a general prohibition on trading meme coins. Its listing restriction applies specifically to tokens meeting the law’s public-official criteria.

Attorney General Can Seek Injunctions and Disgorgement

California’s Attorney General can bring a civil action to enforce the law, seek an injunction against prohibited conduct and request disgorgement of money obtained through violations.

District attorneys, city attorneys and county counsel can separately enforce the prohibition on California public officers and covered employees issuing meme coins. Their authority under AB 2409 does not extend to the service-provider listing restriction.

The immediate compliance requirement for crypto platforms is identifying meme coins issued on or after Jan. 1, 2027 that are offered by, or in partnership with, covered federal, state or local officials before making them available to California residents.