A new report from Solidus Labs has exposed a huge amount of what it calls “fraudulent” activity on the Solana blockchain.
The findings revealed that 98.6% of tokens launched on Pump.fun could be classified as either rug pulls or pump-and-dump schemes.
Solana: A Hotbed for Meme Coin Scams?
In its report, the crypto surveillance firm pointed to Solana’s low fees and user-friendly decentralized exchanges (DEX) as key reasons why it has become a hotspot for meme coin speculation.
“Investors beware as the Solana ecosystem continues to grow, it’s increasingly becoming ground zero for memecoin fraud,” Solidus warned.
At the heart of this growth is Pump.fun, a Solana-based token-generating platform, which has seen daily trading volumes exceed $100 million. According to Solidus, this figure was mainly driven by speculative meme coin activity.
Between January 2024 and March 2025, over 7 million tokens were deployed with at least five trades each. Of these, only 97,000 retained liquidity above $1,000. The report concludes that 98.6% of tokens on the platform collapsed into worthless pump-and-dump schemes shortly after launch.
Earlier in the year, CryptoPotato reported on a Pump.fun user who created at least 18,000 coins and netted more than $3.7 million from rapid price pumps and strategic exits.
The platform recently launched an automated market maker (AMM) that applies a bonding curve pricing model. Under this system, token prices increase exponentially with each purchase, which benefits creators and early buyers.
According to the analysis, this model disadvantages later participants due to higher token prices and potential losses when creators liquidate their holdings.
A separate report by Pine Analytics also highlighted a practice known as deployer-funded, same-block sniping. This method allows creators to profit by executing trades within the same block as token deployment.
Solidus Labs also examined Raydium, another major Solana-based DEX that uses traditional liquidity pools funded by token makers. Out of 388,000 pools analyzed, 361,000, or 93%, showed characteristics of soft rug pulls. This involved incidents where liquidity was suddenly withdrawn, causing price crashes.
The financial damage from such cases varies. About 25% of the involved amounts were under $732. However, the median figure was about $2,832, while the largest one detected amounted to $1.9 million.
Legal Troubles And Controversies
In January, Pump.fun was targeted by two class-action lawsuits. Both accused the platform of violating U.S. securities laws by facilitating the launch of unregistered tokens and allegedly collecting up to $500 million in related fees.
In December last year, it was forced to temporarily pause its livestream function after token creators started making disturbing broadcasts to pump their coins. In the immediate aftermath, Pump.fun faced a $22 million revenue crash, with on-chain data showing weekly income nosediving.
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