Solana-based memecoin launchpad Pump.fun has made the headlines again after its recently launched token, PUMP, plummeted to new lows. The nosedive follows a recent update on the token’s highly anticipated airdrop and its legal troubles.
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PUMP Token Loses $1 Billion MC
Just over a week after launch, Pump.fun’s official token has hit a new all-time low (ATL), reaching the $0.0028 area and dropping below the $1 billion market capitalization for the first time since its initial Coin Offering (ICO).
Pump.fun was launched in January 2024 to facilitate and simplify the deployment of tokens. The Solana-based platform quickly became the leading memecoin launchpad in the crypto market, fueling this cycle’s memecoin frenzy.
According to Dune data, the launchpad has deployed nearly 12 million tokens over the last 18 months and generated a Total Revenue of over $775 million. After announcing its official token in early June, the platform’s PUMP rollout had a bumpy road, as its official X account was suspended mid-month.
The token’s public sale was also pushed nearly three weeks from its original June 25 date. Nonetheless, Pump.fun recorded a highly successful sale two weeks ago, raising $600 million in just 12 minutes.
Two days after its launch, PUMP surged around 70% from its ICO price, reaching an all-time high (ATH) of $0.0068 on July 16. Since then, investors have seen a 57.9% price drop, with 25% of its decline occurring in the past 24 hours.
The violent correction has been partially fueled by the recent update of PUMP’s upcoming airdrop. In the token announcement, Pump.fun stated that an airdrop was “coming soon,” but didn’t offer further details.
On Wednesday night, the platform’s co-founder, Alon Cohen, confirmed that there will be a token airdrop but revealed it “is not going to take place in the near future,” which ignited massive backlash from the community and sent the token into its current nosedive.
Community Slams Pump.fun Team
Several X users have expressed their concerns and discontent with Pump.fun’s team, with some claiming that it is “easily one of the worst charts out right now” as “PUMP is trading like the devs already gave up.”
Another user stated that “the way PUMP is performing post-TGE is 100% on the team. Only in crypto you can sell a ‘utility coin’ for $1.3B in cash and a week later no one still has a clue what those utilities even are lol.”
Some community members remain hopeful that the cryptocurrency will reverse. Market watcher Bren Trades considers that “The crowd is grave dancing on PUMP. Just like they did with PENGU And we saw how that played out.”
He noted that “If you’ve been here for a while, you know these post-launch dump outs are commonplace.” Meanwhile, crypto analyst Altcoin Sherpa wrote on X that “joking aside, I actually do think that PUMP bottoms relatively soon. I am expecting some sort of giga crime pump eventually.”
Legal Drama Intensifies
In January, Burwick Law filed a class-action lawsuit against the platform, alleging it acted as an unregistered securities exchange. According to the original complaint, users have suffered massive losses due to their tokens’ price plunging after the hype died down.
On Wednesday, the law firm filed an amended lawsuit in the Southern District of New York against the platform and some of its Solana partners, including Solana Labs, the Solana Foundation, Jito Labs, and the Jito Foundation.
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The new complaint escalates the extent of the allegations, claiming that the defendants have extracted over $5.5 billion from customers through schemes, and seeking rescission of Pump.fun transactions and compensatory damages.
As of this writing, PUMP is trading at $0.0028, a 26.6% decline in the daily timeframe.
Featured Image from Unsplash.com, Chart from TradingView.com
