Solana-based memecoin platform Pump.fun is facing a class-action lawsuit in a New York federal court, accusing it of issuing unregistered securities and generating nearly $500 million in fees.
The lawsuit, filed on January 30 by Diego Aguilar, claims that Pump.fun’s operations caused substantial financial losses for retail investors. It describes the platform as an evolved form of Ponzi and pump-and-dump schemes.
Pump.fun, allegedly operated by UK-based Baton Corporation, used aggressive marketing tactics to inflate demand for highly volatile memecoins. Aguilar alleges the platform collaborated with influencers to promote these tokens, referring to them as “unregistered security memecoins.”
The lawsuit names Baton Corporation officers Alon Cohen, Dylan Kerler, and Noah Bernhard Hugo Tweedale as defendants. Aguilar argues the company controlled the technical infrastructure, liquidity, pricing, and promotion of the tokens, effectively acting as both an issuer and a statutory seller.
The legal filing seeks rescission of all token purchases, monetary damages for affected investors, and coverage of litigation costs under alleged violations of the Securities Act.
This lawsuit adds to Pump.fun’s mounting legal challenges. In mid-January, New York attorney Max Burwick accused the platform of facilitating memecoin rug pulls, leading to significant investor losses. He criticized its targeting of younger and financially vulnerable individuals, calling it a scheme to enrich early insiders at the expense of retail investors.
The platform also came under fire in November 2025 for allegedly hosting inappropriate and antisocial content. Beau, a safety project manager at NFT project Pudgy Penguins, flagged an incident where a user threatened self-harm over a token’s market performance. He urged Pump.fun to disable its livestream feature, which critics argue fosters a toxic trading environment.
Despite mounting legal and ethical concerns, Pump.fun continues to generate significant revenue. Data from Dune Analytics shows the platform’s total earnings approached $500 million as of January 31, with $47 million generated in the past week alone.
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