Solana-Based Meme Coin Launchpad Pump.fun Hit with Class-Action Lawsuit

Popular Solana-based meme coin launchpad Pump.fun has been hit with a class-action lawsuit alleging every token created on the platform is an unregistered security.

Solana-based meme coin launchpad Pump.fun has found itself at the center of a class-action lawsuit, with allegations surfacing that every token created on the platform constitutes an unregistered security.

On Jan. 30, a complaint was filed in a New York federal court by Diego Aguilar against Pump.fun, which is reportedly operated by the United Kingdom-based Baton Corporation.

Pump.Fun Accused Of Creating A False Sense Of Urgency For New Tokens

Within the filing, Aguilar highlighted the company's use of guerilla marketing tactics to instill an artificial urgency for the “highly volatile” tokens created on the platform, which allegedly led to substantial losses for retail investors.

“Pump.Fun's core function is to work alongside influencers to co-issue and market unregistered securities,” Aguilar stated in the filing. “Inherent to its operations are a novel evolution in Ponzi and pump-and-dump schemes.”

only possible on Solana pic.twitter.com/I1Lc5GPFw1

— pump.fun (@pumpdotfun) January 18, 2025

The complaint also names Alon Cohen, Dylan Kerler, and Noah Bernhard Hugo Tweedale, who are listed as officers of Baton Corporation.

Burwick Law Also Takes Legal Action Against Pump.fun

Aguilar's lawsuit is not the sole legal case against Pump.fun. Earlier in the month, US law firm Burwick Law also announced that it will be taking legal action against the platform. According to the firm, investors who engaged with Pump.fun tokens faced losses through rug pulls and meme coins that made “unfulfilled promises.”

“In the past few months, Pump.fun has collected hundreds of millions of dollars in fees while illicit drug use, self-harm, racism, antisemitism, lewd acts, bestiality, violent and other antisocial acts were displayed on the platform,” the law firm stated.

Potential Winners

Among the potential beneficiaries from these actions is Pepe Unchained (PEPU), which is preparing to launch Pepe's Pump Pad, a meme coin launchpad set to clash with Pump.fun.

PEPU has experienced an 11% surge in the past 24 hours and a 53% increase over the past week amid news of its launchpad's imminent launch.

Another potential beneficiary is Meme Index (MEMEX), a new presale offering investors the first-ever diversified meme coin baskets to help reduce the high risk associated with platforms like Pump.fun.

It offers four portfolios, ranging from the lowest-risk Meme Titan (which invests in top meme coins like Dogecoin and Shiba Inu) to the highest-risk Meme Frenzy, which focuses on new, high-potential-return projects.

MEMEX has managed to raise over $3.1 million in just over a month.