Solana-based memecoin platform Pump.fun has found itself at the center of a class-action lawsuit, with accusations of orchestrating a multi-million dollar operation involving unregistered securities.
The suit, filed by Diego Aguilar in a New York federal court on January 30, alleges that the platform, reportedly managed by the UK-based Baton Corporation, facilitated the creation and promotion of highly volatile tokens, making nearly $500 million in fees in the process.
Retail Investors Hit Hard, Lawsuit Claims
According to the complaint, Pump.fun engaged in “guerrilla marketing” tactics, artificially driving urgency for tokens linked to the platform. This created significant risks for retail investors, leading to substantial losses in what the lawsuit claims were nothing more than modern-day Ponzi and pump-and-dump schemes.
“Pump.Fun’s core function is to work alongside influencers to co-issue and market unregistered securities,” the lawsuit stated, further alleging that the platform’s practices evolved into dangerous financial schemes that primarily benefitted its creators while leaving investors vulnerable.
Aguilar, who claims to have personally purchased several memecoins through the platform, has extended the lawsuit to include all tokens offered by Pump.fun. The legal action targets the platform’s operations, asserting that Pump.fun acted as the issuer and statutory seller for the tokens, controlling everything from liquidity to promotion. The lawsuit accuses the platform of violations under the Securities Act and demands rescission of all token purchases, alongside monetary damages and litigation costs.
Pump.Fun Accused of Exploiting Memecoin Mania
This suit comes just weeks after another US law firm, Burwick Law, announced it was taking legal action against Pump.fun for similar concerns. In its statement, Burwick alleged that the platform’s operations were marked by rug pulls, fraudulent promises, and a troubling display of inappropriate content, including violence and offensive imagery.
At its peak earlier this month, Pump.fun saw a massive surge in activity, recording $3.3 billion in weekly trading volume following the launch of Trump-themed memecoins, highlighting the extent of its reach and influence in the memecoin market.
Neither Pump.fun nor Baton Corporation has responded to requests for comment, and information on the defendants’ legal representation is not yet available. The case has attracted widespread attention as a significant marker in the ongoing debate over the regulation of digital assets and the potential risks posed by unregulated platforms.
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