Pump.fun Faces $5.5B Class Action Over Alleged Meme Coin Gambling Scheme

A class action lawsuit filed July 24 in the U.S. District Court for the Southern District of New York accuses memecoin platform Pump.fun and Solana-related entities of operating an unlicensed digital gambling enterprise that extracted $4 billion to $5.5 billion from retail users.

Burwick Law filed the complaint against multiple defendants including Pump.fun's operators, parent company Baton Corp., and several Solana-affiliated entities. The lawsuit claims the platform allowed anonymous token creation without proper disclosures or investor protections.

The lawsuit describes Pump.fun as a “front-facing slot machine cabinet” that turned each token launch into cycles of early wins followed by collapses. Plaintiffs estimate losses based on on-chain transaction data and trade outcomes.

The lawsuit includes charges of racketeering, wire fraud, false advertising, and unregistered securities sales under federal and New York law.

Solana-related entities allegedly profited from each transaction through network fees and token price increases. The complaint also targets Jito Labs for allegedly enabling front-running through specialized trading tools that give certain users unfair advantages.`

Pump.fun reached a $2 billion market capitalization earlier this month following a $600 million token launch. The platform attracted users with its simple interface and low barriers to token creation.

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Burwick Law has previously targeted Pump.fun over the PNUT meme coin collapse in January. The firm also pursued claims related to Argentina's $LIBRA token, which resulted in a court-ordered freeze of $58 million in USDC.