Newsom Signs California Memecoin Ban, Calls It ‘The Opposite of Trump’

California Gov. Gavin Newsom has signed AB 2409 into law as part of a broader package aimed at combating corruption and protecting consumers, presenting the measure as a response to controversies surrounding President Donald Trump’s $TRUMP memecoin.

The new law prevents California public officials from launching memecoins or other cryptocurrencies built around a prominent person, internet joke or viral trend rather than a defined utility.

Newsom signed AB 2409 on Sunday alongside 10 other measures focused on corruption and consumer protection. The broader package also establishes procedures for compensating victims of crypto scams and creates a legal mechanism for authorities to seize cryptocurrency linked to transnational criminal organizations.

Newsom Targets Political Crypto Profits

Newsom’s office promoted the legislation under the headline “THE OPPOSITE OF TRUMP,” directly contrasting California’s approach with the Trump administration and accusing it of corruption and self-dealing, including through the $TRUMP token.

“While the scam that is Donald Trump continues to hurt American families, California is fighting to make our economy work for people, not the powerful. No official should profit off their office — and we’re putting stronger protections in place to ensure it doesn’t happen in our state,” Newsom said in the announcement.

Trump’s office had not immediately responded to CoinDesk’s request for comment.

The legislation does not clearly establish whether its restrictions apply to memecoins that were already launched, including Trump’s $TRUMP token.

$TRUMP Surged Before Crashing

Trump introduced the $TRUMP memecoin three days before his inauguration in early 2025. The token quickly became the center of intense speculative activity, climbing from below $1 to about $75 within roughly one to two days and briefly reaching a market capitalization of $14 billion.

The rally was followed by a sharp decline, leaving smaller investors with substantial losses.

Nansen data indicates that 988,905 buyers collectively lost $3.81 billion. At the same time, Trump’s financial disclosure reports $636 million in royalties associated with the token, while affiliates of the Trump Organization control approximately 80% of its supply.

The token was trading at about $2.03 at the time of writing.

Newsom is approaching the end of his second and final term as California governor in January and is widely regarded as a potential candidate for the 2028 presidential election.