Essential Insights
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Fraudulent Activity Exposed: A Solidus Labs report reveals 98.6% of tokens on the Pump.fun platform are either rug pulls or pump-and-dump schemes, highlighting severe fraud risk in the Solana ecosystem.
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Meme Coin Speculation: Solana’s low transaction fees and accessible DEXs make it a hotspot for speculative meme coin activity, with daily trading volumes exceeding $100 million.
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Token Collapse and Liquidation: Out of over 7 million tokens launched, only 97,000 retained liquidity above $1,000, with most collapsing into worthless schemes shortly after launch.
- Legal Issues for Pump.fun: The platform faces multiple class-action lawsuits for alleged securities law violations, while also experiencing significant revenue declines following controversial broadcasts and operational issues.
98% of Tokens on Pump.fun Are Rug Pulls or Fraud: Report
A new report from Solidus Labs has revealed alarming statistics about tokens on the Pump.fun platform. The study found that 98.6% of these tokens qualify as either rug pulls or pump-and-dump schemes.
The Solana blockchain has attracted attention for its low fees and user-friendly decentralized exchanges (DEX). Solidus Labs warns investors that as Solana grows, it risks becoming a hub for meme coin fraud. Daily trading volumes on Pump.fun have soared past $100 million, driven largely by speculative interest.
Between January 2024 and March 2025, over 7 million tokens launched on the platform. However, only 97,000 of these maintained liquidity above $1,000. The majority quickly collapsed into worthless schemes post-launch.
Earlier reports noted a user on Pump.fun who created 18,000 tokens, profiting more than $3.7 million through swift buying and selling. This prompts a closer look at the platform’s new automated market maker (AMM). Its bonding curve pricing model raises token prices exponentially with each purchase. While this benefits early participants, later investors face inflated prices, leading to potential losses.
Additionally, Pine Analytics highlighted a controversial tactic called deployer-funded, same-block sniping. This allows token creators to profit immediately after deploying tokens. Analysis of Raydium, another major Solana DEX, found that 93% of its liquidity pools exhibited signs of soft rug pulls, leading to sudden price drops.
The financial fallout from such schemes varies. Approximately 25% of affected amounts were under $732, but the median loss reached $2,832. Some losses, however, soared to $1.9 million.
Legal issues have also plagued Pump.fun. In January, the platform faced two class-action lawsuits for allegedly launching unregistered tokens and collecting up to $500 million in fees. Last December, disturbances during livestreams prompted a pause in operations, resulting in a $22 million revenue drop.
As the crypto landscape evolves, these findings emphasize the urgent need for investor vigilance. With the rise of token-generating platforms like Pump.fun, understanding risks becomes crucial in navigating the digital currency space.
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Disclaimer
This content is for informational and entertainment purposes only and does not constitute financial or investment advice. Cryptocurrency is highly speculative and carries significant risk, including the potential loss of your entire investment. Do not make financial decisions based on this information. Consult a licensed financial advisor before investing. This site does not offer, sell, or advise on cryptocurrency, securities or other regulated financial products in compliance with SEC and applicable laws. Please do your own research and seek professional advise.
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