Pump.fun Raked in $741M Why Critics Say It’s a Threat to Crypto’s Future

Pump.fun has come under fire after accumulating $741 million in user fees while facing severe allegations from crypto critics. Influencers have described the Solana-based memecoin launchpad as a growing threat to crypto’s integrity. The mounting scrutiny now threatens the company’s proposed $1 billion token sale amid accusations of enabling dangerous behavior.

Pump.fun Extracted $741 Million in Fees While Most Users Lost

Pump.fun reportedly extracted $741 million in fees by selling over 4.1 million SOL since May 2024, according to LookOnChain. The platform transferred 3.84 million SOL to Kraken and swapped 264,373 SOL into $41.64 million USDC. While fee revenues soared, user data revealed that only 293 out of 13.55 million wallets earned above $1 million.

 

The fee structure charges a 0.25% cut on every transaction, now with an added 0.05% sent to token creators. Analysts warn this model encourages quick-deploy scams and incentivizes developers to abandon projects after launching. Users consistently report losses, while the platform continues generating millions daily from trades.

Although Pump.fun launched in January 2024, it has already processed over $66 billion in total volume and launches more than 27,000 tokens daily. Despite this growth, critics claim the platform disproportionately profits from failed investments. The data highlights the large gap between user losses and platform earnings.

Livestream Feature Sparks Safety and Mental Health Concerns

Pump.fun also faces backlash over its livestreaming feature, which critics link to disturbing and violent behavior from users. In November 2024, the platform suspended livestreams following broadcasts of extreme content aimed at token price manipulation. Despite assurances of better moderation, the feature returned in April 2025 to a small user group.

However, the updated version lacked effective safety controls, leading to renewed reports of self-harm threats tied to token performance. Critics allege Pump.fun failed to prevent psychological harm and failed to moderate harmful broadcasts. This has raised ethical questions about the platform’s commitment to user safety.

The controversy escalated as Crypto Bitlord accused Pump.fun of contributing to mass psychological distress through livestream incentives. The influencer also estimated that scams facilitated on the platform have caused over $20 billion in damage. These claims have added pressure on regulators to intervene and scrutinize the platform’s practices.

Hey @pumpdotfun there is currently someone using your livestreams to threaten to hang themselves if the coin does not reach a set marketcap.

Absolutely heinous and It needs to come down + see if you can get them help.

Shut down the livestream feature. This is out of control.

— Beau (@beausecurity) November 25, 2024

Social Media Bans and Legal Pressure Intensify

X suspended the official accounts of Pump.fun and co-founder Alon Cohen without publicly disclosing the reason. Industry sources suspect the ban relates to potential API misuse, SEC investigations, or securities violations. This comes at a critical time as the platform prepares for a billion-dollar token fundraising.

The X suspension limits Pump.fun’s primary communication and promotion channel, complicating investor outreach and user engagement. Analysts warn this disruption could impact the company’s planned $4 billion valuation. Legal experts believe the timing may influence the outcome of the ongoing lawsuit over securities violations.

The lawsuit alleges Pump.fun facilitated the sale of unregistered securities by disguising them as meme tokens. Authorities are reviewing whether the platform promoted volatile financial instruments to retail traders without compliance. Regulatory bodies are now closely monitoring the company’s future token sale and platform operations.

FAQs

What is Pump.fun?

Pump.fun is a Solana-based platform that allows users to launch and trade memecoins with minimal barriers.

How much revenue has Pump.fun generated?

Pump.fun has generated an estimated $741 million in fees by selling over 4.1 million SOL tokens.

Why are critics concerned about Pump.fun?

Critics cite user losses, unregulated tokens, and livestream content linked to mental health and safety risks.

What are the allegations against Pump.fun?

Pump.fun faces accusations of enabling scams, extracting billions in value, and hosting harmful livestreams.

What legal challenges does Pump.fun face?

The platform is under investigation for potentially violating securities laws and misleading retail investors.

Glossary of Key Terms

Pump.fun – A memecoin launchpad built on the Solana blockchain known for high trade volumes and low barriers to entry.

SOL (Solana) – The native cryptocurrency of the Solana blockchain used for fees and transactions.

Rug pull – A type of scam where token creators abandon a project after collecting funds from users.

USDC – A stablecoin pegged to the U.S. dollar, commonly used for crypto trades.

Kraken – A cryptocurrency exchange where Pump.Fun reportedly deposited most of its SOL revenue.

References:

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