Lawmakers raise alarm over tweets, 'meme coins' and Justin Sun ties; SEC chair says he cannot discuss active investigations

Several members of the House panel raised concerns about potential market manipulation tied to social-media posts and trading in so-called "meme coins," citing transactions tied to Justin Sun and family-branded coins launched in January.

Representative Mark Pocan described a series of trades and public posts that, he said, appeared to raise questions about possible insider trading or coordinated market manipulation. Pocan cited an 11/25/2024 purchase, follow-on buys in January, the January 17 and 20 social-media posts announcing a family-branded coin, later coin purchases, and subsequent public events and fundraising tied to the coin. He said the timeline and trading activity merited closer scrutiny.

Atkins declined to discuss specific investigations. "I can't really talk about any, you know, investigations current or potential or past," he told the panel. He described the SEC's investigative intake process in general terms: staff or regional offices can open a matter under investigation, and if it develops, the enforcement division can request formal investigative authority.

Lawmakers told Atkins they had sent letters (including from Senators and other House members) seeking information and asked the SEC to respond. Atkins said the agency takes letters from Congress seriously and pledged to respond, but he said he did not have details about specific active cases.

Members also raised the overlapping civil case involving Justin Sun and referenced a stay motion and consolidated lawsuits. Atkins said he was not familiar with the specifics of that case and noted that SEC staff had previously issued guidance describing some meme coins as collectibles rather than securities, depending on their attributes.

The exchange underscored lawmakers' concern about quick-moving markets, the potential for insiders or connected parties to profit from public statements, and the difficulty of applying century-old tests such as Howey to new instruments. Atkins repeatedly told lawmakers the outcome depends on facts and that the staff is capable of detecting suspicious trading patterns.

No committee action or SEC determination was announced during the hearing; members asked for formal responses to letters and for the agency to take the congressional concerns under advisement.