Summary of Key Developments
- •Nearly $436 million USDC has been transferred to Kraken amidst ongoing allegations.
- •The price of Pump.fun's PUMP token has experienced a decline of over 40%.
- •A class action lawsuit seeking $5.5 billion has been filed against Pump.fun.
The Pump.fun project is currently facing accusations of token dumping. The controversy revolves around significant USDC transfers to the Kraken exchange. These actions were highlighted by Lookonchain, a blockchain analytics firm, which reported that nearly $436 million USDC was involved. These transfers are believed to be related to potential sell-offs, raising concerns within the cryptocurrency community.
Pump.fun's co-founder, Sapijiju, has publicly denied the allegations of token dumping. He has stated that the transactions are part of standard treasury management of ICO proceeds. Despite his assurances, the Pump.fun Twitter account has been silent for approximately 10 days during this controversy. This silence has contributed to uncertainty among users.
Massive USDC Transfers Under Scrutiny
Blockchain data indicates that approximately $480 million USDC was transferred from Pump.fun-related wallets to Kraken since mid-October. Following these transfers, $537 million was moved from Kraken to Circle. This movement suggests that the assets may be tied to further sales. Additionally, Pump.fun reportedly sold $757 million worth of SOL between May 2024 and August 2025.
The price of Pump.fun's native token, PUMP, has seen a substantial decline of over 40%. Currently trading near $0.0029, it has dropped significantly from its ICO peak of approximately $0.009. These developments coincide with a notable decrease in revenue, from $136 million in January to just $38 million.
Impact on Assets and User Activity
The current scenario affects several critical assets. These include Pump.fun's PUMP token, the stablecoin USDC used for transfers, and Solana's SOL token, which has been heavily offloaded. The use of Kraken as a gateway for USDC transfers has brought the exchange into the spotlight as well.
Pump.fun's user activity and token usage also appear to be on a downward trend. The project's Total Value Locked (TVL) and engagement metrics like Mayhem Mode participation have declined sharply. Discussions on social platforms highlight growing community dissatisfaction and mistrust.
Legal Actions and Market Reactions
Adding to Pump.fun's challenges is a $5.5 billion class action lawsuit filed against the company and other entities. This lawsuit, brought forth in July 2025, accuses Pump.fun of operating an illegal securities exchange and conducting pump-and-dump schemes. These legal issues have intensified the scrutiny on Pump.fun.
So far, there have been no public comments from major crypto industry figures regarding this situation. This includes individuals like CZ and Vitalik Buterin. However, blockchain analytics and community sentiment suggest widespread concern around the allegations and potential regulatory implications.
Community's Response and Future Concerns
Community sentiment around Pump.fun appears to be largely negative. The silence from official channels coupled with significant project losses has heightened user distrust. There is also a notable drop in developer engagement, as seen in reduced GitHub activities and sparse technical updates.
At present, regulatory bodies have not issued new public announcements directly related to the USDC transfers. Nonetheless, the ongoing class action and securities allegations suggest a high level of regulatory oversight and potential for future developments. As a result, the broader pump-and-dump controversy continues to overshadow the project's prospects.