PANews reported on January 14th that, according to DL News, law firm Burwick Law has recently filed another lawsuit against the Pump.fun platform and Solana-related parties, accusing them of operating a "manipulated, unlicensed gambling operation." The lawsuit alleges that while Pump.fun is packaged as a game of chance, it is in reality a "manipulated casino," with its leaders "secretly pre-determining winners and losers and extracting huge profits from retail participants." The lawsuit cites information allegedly obtained from private messages with Pump.fun's founders, in which co-founder Alon Cohen admits that most investors "lose money" when investing on the platform and states that the platform "greatly democratized trading in low-market-cap tokens, exposing everyone to the extremely low odds associated with gambling on such low-market-cap assets." The lawsuit also cites allegations from anonymous KOLs that they or their peers were paid to promote Meme Coin without disclosure and received advance information about the token to buy it before the promotion began.
However, the lawsuit failed to provide conclusive evidence that Pump.fun coordinated these alleged pump-and-dump schemes, nor did it prove that its executives directly profited from them. The core argument of the lawsuit lies in its claim that the platform failed to implement fair safeguards, such as a random entry window to mitigate the advantage of bots and insiders having priority in building positions. Regarding Solana's allegations, the lawsuit claims that its network speed, priority fee system, and the congestion update in March 2024 enabled the scaling of Meme coin trading, but this connection is considered weak by outsiders.
