Navigating The Meme Coin Maze – SEC Opinion And Canadian Implications

On February 27, 2025, the US Securities and Exchange Commission (SEC) released a Staff Statement on meme coins (the Statement). In the Statement, the Division's Staff shared its views that meme coins, generally speaking, do not typically constitute securities, nor does their transfer constitute the sale of securities under federal securities laws.¹ The Staff makes clear, however, that the Statement does not negate the possible finding of an investment contract involving meme coins, depending on the facts and circumstances. These facts and circumstances include, but are not limited to, marketing/promotional efforts and pooling of funds for business purposes.² Regardless of how caveated, the Statement has sparked internal debate within the SEC. Commissioner Caroline Crenshaw criticized the Statement for its lack of a clear definition of a meme coin. She emphasized that the "economic reality" of most meme coins — in her view, to make money and generate profits based on