Solana-based decentralized exchange Meteora is facing a class-action lawsuit

An April 21 filing in the US District Court for the Southern District of New York, brought on behalf of affected investors, alleges that Meteora, its CEO Benjamin Chow

Solana-based decentralized exchange Meteora is facing a class-action lawsuit for allegedly fraudulent launch of the M3M3 token, which resulted in huge losses for investors.

The suit, filed on April 21 in the US District Court for the Southern District of New York, was brought by a group of affected investors against Meteora, its CEO Benjamin Chow, venture firm Kelsier Labs, and executives Hayden, Gideon, and Charles Thomas Davis.

According to the complaint, insiders behind the project quietly secured as much as 95% of the M3M3 token supply by using a network of over 150 wallets.

They then restricted access to public buyers during the early trading window, locking out retail investors while inflating the price through internal trades. Once the price reached desired levels, the insiders dumped their holdings, triggering a sharp crash within days.

The lawsuit says the project was pitched as a solution to the “pump-and-dump” culture plaguing meme coins, with Chow promoting M3M3 as a safe, stake-backed token with long-term value.

Investors were told that the launch would be transparent and open, and that staking rewards would come from transaction fees on Meteora itself, claims which plaintiffs now argue were deliberately misleading.

This coordinated scheme led to over $69 million in damages, as non-insider investors bought into the hype only to see the token’s value collapse within days of its launch on December 4. The sharp downturn began on December 6, shortly after insiders offloaded their tokens.

Plaintiffs allege that the defendants made calculated efforts to regain investor trust after the crash by artificially re-inflating the token’s value, but these attempts failed to restore long-term stability.

They also claim that the defendants purposely concealed their identities and affiliations during the offering, creating the illusion of a fair, community-driven launch.

Both Meteora and Kelsier Labs have already faced scrutiny this year for their alleged involvement in the LIBRA token crash that wiped out millions.

During the LIBRA scandal, insiders were accused of using private liquidity structures to cash out at the top, leaving regular traders. The same teams were also linked to MELANIA, another memecoin launch that ended in losses for retail buyers.

Chow has since stepped down from his role at Meteora, following allegations that he privately received or managed LIBRA tokens.

The April 21 suit claims the launch of M3M3 followed a similar playbook. As such, plaintiffs are asking the court to appoint a receiver over Meteora to oversee its operations and safeguard remaining assets.

They’re also pushing for stake-based meme tokens like M3M3 to be officially classified as securities.

“The complaint asks the court to classify stake-based meme tokens as securities and to appoint a receiver over Meteora, steps that could influence how any new celebrity or political token is brought to market on Solana,” said Max Burwick from Burwick Law, one of the attorneys representing the investor group.

Burwick and his firm previously filed a separate class-action lawsuit on March 18 targeting Kelsier Ventures, KIP Protocol, and Meteora for their alleged roles in the LIBRA token scandal.