98.6% of Pump.Fun Tokens Are Linked to Rug Pulls: Report

A recent report by Solidus Labs has raised concerns about the validity of tokens launched on Pump.Fun, a site that allows users to create and trade meme coins quickly, has found that 98.6% of the tokens launched on Pump.Fun are linked to scams, such as rug pulls or pump-and-dump schemes.Ominous Pump.Fun Token MetricsOver seven million tokens have been created since the platform launched in 2024. However, only about 97,000 of these tokens, or just 1.4%, have kept at least $1,000 in liquidity. This is a basic sign of ongoing trading interest and value. This data shows that many projects gain short-lived hype, leaving unsuspecting investors with worthless tokens.Pump.Fun has become popular because it is easy to use, allowing anyone create a token in just a few minutes. While this makes it easier for people to innovate and engage with their communities, it has also led to people taking advantage of the platform to scam others. The report has sparked discussions about improving oversight and educating investors in decentralized finance (DeFi) and meme coin markets. While platforms like Pump.Fun promotes decentralization and creativity, but their lack of safety measures raises concerns about the long-term stability of these ecosystems. Memecoin Market Cools OffNotably, the memcoin hype that fueled Pump.Fun’s rise has started sputtering. Rug pulls like Libra have left retail investors wary. Similarly, interest in meme-tokens like TRUMP has nosedived: it is now down over 90% from January peaks, per CoinGecko.Data from Dune Analytics reveals that token graduation is rated on Pump.Fun has also plunged below 1%. Furthermore, weekly token launches have collapsed from 5,400 in January to under 1,500 in March. Even the broader Solana network is not immune: just 31,651 tokens were launched on April 5, compared to 95,578 at January’s fever pitch.Pump.fun Faces Legal PressuresPump.Fun’s drop-in token launches come when the launchpad starts dealing with legal problems. Law firms have sued the platform on behalf of investors, who allegedly suffered significant losses. The law firm claimed the platform exploited users and allowed harmful content to thrive while profiting from its fees. Recall that another lawsuit dragged the platform to court for memecoin impersonation.Adding to its woes, Pump.Fun’s X official account was hacked, leading to fraudulent token promotion. At the same time, the platform faced backlash over testing its Automated Market Maker (AMM) feature, which could replace Raydium. This move sparked concerns within the community. The post 98.6% of Pump.Fun Tokens Are Linked to Rug Pulls: Report appeared first on TheCoinrise.com.