Pump.fun was accused by an American law firm. Users suffered losses and were disgusted by other founders of the Solana ecosystem.

Comprehensive editor: Felix, PANews

On January 16, New York-based cryptocurrency law firm Burwick announced that it would take legal action against Pump.fun on behalf of investors who suffered losses on the meme currency issuance platform Pump.fun. The platform allegedly allows various forms of harmful content to be posted while charging huge fees.

Burwick said the move follows "months" of consultations with victimized users who lost "significant amounts of money" due to unfulfilled promises on platforms such as memecoin, Rug pulls and Pump.fun.

The law firm alleges: “Over the past several months, Pump.fun has collected hundreds of millions of dollars in fees while the platform was riddled with illegal drug use, self-harm, racism, anti-Semitism, obscenity, violence and other anti- Social behavior. Although the platform’s creator acknowledges the importance of transparency in promotion and retail participation, the platform’s creator still chooses to remain anonymous, raising serious public questions about the creator’s lack of responsibility.”

The law firm calls on victims who have been harmed by Pump.fun to participate in possible legal proceedings to seek compensation. The law firm is offering a way to potentially recover at least some of their funds, and any users who have suffered losses can fill out a form and get in touch with Burwick.

Notably, Burwick said this statement was considered "attorney advertising" and "does not guarantee results" and was accompanied by the caveat that "past results are no guarantee of future results."

Pump.fun’s “black history” continues

According to Dune Analytics , Pump.fun has been a dominant force in the meme coin space since its launch in January 2024, with more than 6 million tokens issued by users on its platform.

Although Pump.fun marketed itself as a portal for users without technical expertise to issue tokens, the platform quickly became synonymous with speculative trading and risk-taking.

Pump.fun has also been widely criticized for its now-suspended live streaming feature. Pump.fun launched the live broadcast function in May last year, and started the "live broadcast meme" craze in November. However, due to poor content moderation, users appear dangerous and perform extreme content in live broadcasts, such as animal cruelty and pretending to commit suicide.

In addition, a few weeks before Burwick sued, a poll released by journalist Jack Kubinec showed that most Solana ecosystem project founders (42 founders) expressed disgust with Pump.fun. In other words, this market hype goes hand in hand with a bad reputation. However, Burwick is not the first entity to launch legal action against Pump.fun.

In early December 2024, under pressure and stern warnings from the UK FCA, Pump.fun terminated its UK operations. The ban comes after London police investigated a fraudster on the Pump.fun platform who claimed the platform was running a massive fraud.

The founder of Pump.fun makes money, but most users lose money?

From a financial perspective, everything seems to be going "smooth" for the Pump.fun team to make money. According to Lookonchain statistics on January 14, Pump.fun has deposited 1,785,278 SOL ($359 million) into Kraken and sold 264,373 SOL for 41.64 million USDC. In total, Pump.fun earned 2,241,890 SOL ($410 million).

In sharp contrast to this correspondence, most users do not "gain." Data compiled by a statistician on Dune shows that most Pump.fun traders have not yet achieved profits of more than $10,000. Of the total 13,547,736 Pump.fun wallet addresses, only about 55,296 addresses (0.408%) have achieved it. Profit of over $10,000.

Although the founder of Pump.fun later issued a statement denying this revenue data, saying that most of the total addresses were robots and AI agents, did not take into account unrealized profits, and did not include the purchase of tokens bound to Raydium. However, the "fact" that most players face "losing money" seems to have been a "final conclusion" for a long time.

Related reading: An in-depth analysis of Pump.fun: How does the Meme Coin Casino work?