California is on track to become the first state to put a law on the books specifically targeting public officials who try to cash in on memecoins.
AB 2409, introduced by Assemblymember Avelino Valencia, passed the Senate with 40-0, unanimously, before the Assembly gave it the same treatment with a 78-0 vote this week. Sending it to Governor Newsom’s desk, awaiting signature. This bill draws a clear line between two groups.
The bill would prevent digital asset platforms from offering California residents memecoins launched on or after January 1, 2027, when those tokens are issued by, or created in collaboration with, federal officials or state and local public officers. It defines a memecoin as a digital asset whose value is driven mainly by public attention, speculation, or activity from its community.
The bill uses “public officers” as the broader category. That includes elected and appointed officials at pretty much every level, even people serving on boards and commissions that only have advisory roles. “Public employees,” on the other hand, applies to government staff who actually have the authority to make decisions involving bids and contracts.
It appears aimed at preventing someone with little or no control over government money from being treated the same way as an official who can actually approve a contract. In other words, the bill is trying to close the loophole without dragging every government worker into the same net.
Enforcement is another part of the bill that got a little lost in all those unanimous vote numbers. The state Attorney General would be able to go after violations through injunctions and seek to claw back any profits made from the prohibited activity. But it doesn't stop there. District attorneys, city attorneys and county counsel would also have enforcement authority. So if something happens in a smaller city, it wouldn't necessarily have to sit around waiting for Sacramento to step in.
There’s a federal version of this idea too, although it hasn't gotten nearly as far. Rep. Sam Liccardo introduced the MEME Act in Congress in February 2025, which would bar the president and other federal officials from engaging in similar memecoin-related conduct. Senator Chris Murphy introduced the Senate companion bill. So far, though, that's about as far as it has gone. The legislation has been sitting there without making much progress.
California’s approach is essentially a way around the federal stalemate. Instead of waiting for Congress to pass a new law, the state is using its existing Government Code conflict-of-interest rules to deal with the issue on its own. Legislative counsel described the idea as a “prophylactic rule” basically, put the guardrail in place before the conflict happens rather than trying to punish someone after the fact.
Newsom hasn’t said yet whether he plans to sign it, and California governors haven't exactly been predictable when it comes to crypto-related legislation. If the bill does become law, it would take effect in January 2027. That gives exchanges roughly 16 months to figure out the compliance side and build systems to flag transactions involving this very specific category of tokens.