A prominent U.S. law firm is preparing legal action against the Solana memecoin launchpad Pump.fun on behalf of investors. The New York-based attorneys at Burwick Law announced their intentions via a post on X, citing severe allegations of misconduct, including violence, racism, and fraud on the platform.
This follows the firm’s recent federal lawsuit against the developers of the failed memecoin Hawk Tuah.
Allegations of Serious Misconduct
Burwick Law accuses Pump.fun of fostering a platform rife with harmful content. The firm alleges that disturbing livestreams featured drug abuse, self-harm, racism, antisemitism, obscene acts, and violence, despite generating hundreds of millions of dollars in platform fees.
"In recent months, [Pump.fun] has collected hundreds of millions of dollars in fees while allowing content depicting drug abuse, self-injury, racism, antisemitism, obscene acts, sodomy, violence, and other antisocial behavior," Burwick Law stated.
The firm is urging affected individuals to join the case and seek damages, emphasizing that they have been working closely with individuals who claim substantial financial losses due to memecoin scams and unfulfilled promises on Pump.fun.
Investor Losses and Platform Profits
Pump.fun has emerged as one of the most lucrative applications in the crypto sector. Data from DeFiLlama indicates that the launchpad’s daily revenue has at times surpassed even that of the stablecoin giant Circle.
However, despite its profitability, platform users have reportedly reaped minimal benefits. Analysis from Dune Analytics reveals that only 0.4% of traders on Pump.fun have recorded gains exceeding $10,000. Additionally, fewer than 300 wallets, out of more than 10 million on the platform, have reported profits of $1 million or more.
A Call for Accountability
Burwick Law’s move comes amid growing calls for greater oversight of platforms like Pump.fun. In November, legal experts warned of potential criminal and civil liabilities for the platform due to its failure to moderate harmful content effectively.
If successful, the lawsuit could set a precedent for holding crypto platforms accountable for the behavior and losses experienced by their users. The case highlights the risks of unregulated spaces in the crypto ecosystem, where significant profits for platforms often come at the expense of their users.
