Pump.fun Under Legal Scrutiny: Burwick Law Seeks Compensation
Burwick Law is pursuing legal action against Pump.fun, accusing the platform of unfair practices and deceptive promotions. The crypto community remains split, with some arguing that memecoin investors are fully aware of the risks.
Burwick Law has announced its intention to sue Pump.fun, a Solana-based platform specializing in the launch of memecoins. The lawsuit alleges that users on the platform engaged in misleading promotional activities for several months.
The New York-based firm is no stranger to cases involving memecoins, having previously filed a federal lawsuit against Hawk Tuah Girl, the creator of the failed HAWK token.
Read more: Hawk Tuah Missing After HAWK Token’s Collapse Sparks Allegations
In the past few months, pumpdotfun has collected hundreds of millions of dollars in fees while illicit drug use, self-harm, racism, antisemitism, lewd acts, bestiality, violent and other antisocial acts were displayed on the platform,
Burwick Law stated.
The law firm is calling on individuals affected by Pump.fun’s actions to come forward and join the lawsuit in an effort to recover their lost funds.
A spokesperson for Burwick Law explained that the announcement follows months of work with investors who suffered substantial losses due to memecoins, fraudulent schemes, and unfulfilled promises. These investors are now seeking compensation for the financial damage they incurred.
The firm also raised concerns about the platform’s anonymous creators, citing a lack of accountability and transparency in their actions.
This announcement is classified as “attorney advertising” and includes a disclaimer stating that “past results do not guarantee future results” and that “no outcomes guaranteed.”
Community Reacts: Are Pump.fun Investors Truly Victims?
Similar to the Hawk Tuah Girl memecoin controversy, opinions on Burwick Law’s lawsuit against Pump.fun are deeply divided. Many argue that investing in memecoins is a conscious choice, with participants fully aware of the speculative nature of these assets and the inherent risks of rug pulls or pump-and-dump schemes.
Prominent crypto analyst and blockchain investigator ZachXBT labeled Pump.fun investors as “gamblers” who willingly took risks by investing in low-cap tokens. He says these participants cannot be considered victims or genuine investors.
Some comments were laced with sarcasm. User Panzuki.eth joked that Burwick Law essentially plays a game of Uno, claiming the firm would pocket 95% of any compensation as legal fees, turning it into a “reverse Pump.fun.” Burwick Law has since denied this assertion.
Others responded with humor. One user jokingly blamed Burwick Law for losing an NFT from their wallet, while another asked if it was possible to disregard their profitable trades and seek compensation solely for their losses.
Criticism of Pump.fun
Since January 2024, Pump.fun has become the leading platform for launching memecoins, with over 6 million tokens created. The platform is often credited with fueling the surge in memecoin popularity and driving the adoption of the Solana blockchain.
Originally promoted as a tool for non-technical users to easily create their own tokens, Pump.fun quickly gained a reputation for speculative trading and risky behavior.
The platform has faced criticism for fostering an inequitable environment. Data shows that only 0.4% of users earned more than $10,000, while the majority incurred significant losses.
The live-streaming feature also drew sharp criticism, as users performed extreme and unethical acts to promote their tokens. Incidents included animal cruelty and staged suicide attempts, causing widespread outrage.
In November 2024, Pump.fun suspended its live-streaming feature in response to growing backlash. The following month, the UK regulator banned residents' access to the platform, citing significant risks to investors.
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