The post Pump.fun Faces Lawsuit Claiming Tokens are Unregistered Securities appeared on BitcoinEthereumNews.com.
The lawsuit was filed by Diego Aguilar, who claims the platform collaborated with influencers to facilitate pump-and-dump schemes that led to huge investor losses. Meanwhile, the Nelk Boys are also being sued over their $23 million MetaCard NFT project, and are facing allegations of false promises and misleading marketing. In China, a court sentenced BKEX executives for operating an illegal crypto gambling platform, and several employees are facing prison time for facilitating high-leverage trading. Pump.fun Hit with Class Action Suit Solana-based meme coin creation platform Pump.fun is facing a class-action lawsuit which alleges that every token launched on its platform constitutes an unregistered security. The suit was filed by Diego Aguilar in a New York federal court on Jan. 30, and claims that Pump.fun generated close to $500 million in fees from these token sales. The lawsuit also accuses the platform of employing aggressive marketing tactics to create artificial urgency, which led to major financial losses for retail investors. According to the complaint, Pump.fun’s business model revolves around working with influencers to issue and promote unregistered securities. This effectively turns traditional Ponzi and pump-and-dump schemes into a new format. The lawsuit names Alon Cohen, Dylan Kerler, and Noah Bernhard Hugo Tweedale, who are all listed as officers of Baton Corporation in UK Companies House records. Aguilar claims to have bought several meme coins from the platform, and is targeting all tokens on Pump.fun by branding them as “unregistered security meme coins.” According to the filing, Pump.fun acted as both an issuer and statutory seller, which allowed it to maintain control over the tokens’ infrastructure, liquidity, pricing, and promotion. The lawsuit seeks remedies including the rescission of all token purchases, financial compensation for any affected investors, and coverage of litigation costs. Pump.fun and Baton Corporation have not commented on the lawsuit…