Pump.fun faces class-action suit

Pump.fun, a Solana-based (CRYPTO:SOL) memecoin creation platform, has been hit with a proposed class-action lawsuit alleging that all tokens it facilitated are unregistered securities, resulting in nearly $500 million in fees for the company.

The lawsuit, filed by Diego Aguilar in a New York federal court on January 30, claims that Pump.fun, operated by Baton Corporation, engaged in deceptive marketing practices that created artificial urgency around volatile tokens.

Aguilar asserts that he suffered losses from trading various memecoins on the platform, which he claims are classified as “unregistered security memecoins.”

The complaint describes Pump.fun’s operations as a “novel evolution in Ponzi and pump-and-dump schemes,” highlighting the risks posed to retail investors.

The lawsuit also names Baton Corporation officers Alon Cohen, Dylan Kerler, and Noah Bernhard Hugo Tweedale as defendants.

According to the filing, Pump.fun functions as both an issuer and statutory seller of these tokens, controlling their technical infrastructure and promotion.

The suit alleges violations of the Securities Act and seeks rescission of token purchases, monetary damages for affected investors, and litigation costs.

Pump.fun has not publicly commented on the lawsuit, and information regarding the defendants’ legal representation is currently unavailable.

This legal action follows earlier claims by Burwick Law against Pump.fun for investor losses tied to memecoin rug pulls and unfulfilled promises.

The platform recently experienced a surge in usage, recording an all-time high of $3.3 billion in weekly trading volume after launching Trump family memecoins.