The SEC is waving off any claim of authority over much of the memecoin market.

In a statement, staff at the Wall Street regulator said Thursday that memecoins — an extremely volatile type of cryptocurrency token that is often launched for entertainment purposes — generally fall outside the SEC's purview and are not protected by the agency's investor-protection rules. Individuals or firms that offer or sell memecoins probably do not need to register the transactions with the SEC, as a result, the agency said.

"[M]eme coins are akin to collectibles," the statement said. "Given the speculative nature of meme coins, they tend to experience significant market price volatility, and often are accompanied by statements regarding their risks and lack of utility, other than for entertainment or other non-functional purposes."

The SEC's statement — yet another indication of the agency's new approach to the crypto market — follows a boom of interest in memecoins, which even drew in President Donald Trump. Just days before taking office, Trump launched a memecoin of his own, $TRUMP. Other well-known memecoins include Dogecoin, Fartcoin and Pepe.

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