Democratic Senators Elizabeth Warren and Richard Blumenthal asked the Securities and Exchange Commission to investigate President Donald Trump's $TRUMP memecoin. They cited estimated losses of about $3.8 billion for nearly one million investors.

The Digital Asset Market Clarity Act, which establishes a regulatory framework for cryptocurrency markets, is pending in Congress. The SEC has said memecoins lack significant utility and are not securities under U.S. law. The request was made while Congress debates an ethics provision that would bar senior officials from direct participation in crypto projects.

In a letter dated Monday, the senators asked SEC Chair Paul Atkins to examine the $TRUMP token. The letter noted that Trump's financial disclosure reported $636 million in proceeds from the token.

The $TRUMP token peaked at more than $46 before falling to $1.47. Its price briefly rose after the issuing entity announced plans to hold events at Mar‑a‑Lago, where Trump served as keynote speaker, but those spikes were short‑lived.

The SEC previously indicated that memecoins are outside its jurisdiction. In a staff statement released after the Trump administration took office, the agency described memecoins as having limited functionality and not meeting the criteria for a security.

Trump has agreed to certain restrictions on his involvement with the token, though those restrictions are expected to have limited effect. Democratic leaders opposed the proposed limits and said they would not support the Clarity Act unless the ethics provision was strengthened. A revised version negotiated by Senators Thom Tillis and Ruben Gallego was sent to the White House last week, and the administration has not yet responded.

Senate Majority Leader John Thune plans to begin the Senate voting process for the Clarity Act this week, a step that could affect the bill's passage if Democratic support does not coalesce. Warren, the ranking member of the Senate Banking Committee, has been outside the negotiations and has opposed the bill. She said she would likely assume leadership of the committee if Democrats regain control of the Senate in the upcoming midterm elections.

The White House has not responded to inquiries about its stance, and the SEC has not indicated whether it will conduct an investigation. The ultimate impact of the request and the legislation remains unresolved.