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Author: Yohan Yun, CoinTelegraph; Compilation: Baishui, Bitchain Vision
Pump.Fun’s live broadcast feature seems to have become a platform for developers to play extremely shocking content to promote their tokens — which could lead to civil or criminal lawsuits, according to legal experts.
From suicide threats, animal abuse to pornography, developers who break boundaries face almost no consequences except when the content is deleted.Meanwhile, industry players urged Pump.fun to stop streaming live (it did it earlier today) until it can adjust the content properly.
Calls on Pump.fun to turn off its live broadcast feature.Source: Beau
Pump.fun is one of the huge successes this year, offering a codeless token issuance service with just a few clicks, playing a big role in Solana’s memecoin superstar.
Although the platform is the birthplace of multiple scam tokens and scams, it is still not regulated.However, the latest series of provocative actions in its live stream are prompting market watchers to call for regulatory action.
“This is a legitimate reason for conducting criminal investigations and civil litigation,” said Yuriy Brisov, partner at Digital and Analogue Partners.
“While we strongly support freedom of speech, it is our responsibility to make sure users do not see objectionable/dangerous content and not provide a platform for bad actors to do whatever they want,” Alon said.
Responsibility of Pump.fun and Content Platforms
Pump.fun’s latest issue on live streaming has sparked another ongoing debate about whether channels that distribute user-generated content, such as X or YouTube, should be responsible for what they share on their platform.
On social media, despite advances in content review technology, illegal content tends to slip through the gaps when user-generated content is flooded.
Recently at Pump.fun, a “developer” threatened that if their tokens do not reach a certain market capitalization, he would hang himself, while another threatened a goldfish in front of the camera.
Source: DBCrypto
Mikko Ohtamaa, co-founder of algorithmic trading company Trading Strategy, said on X,Pump.fun has two options: either quickly shut down by the police after choosing not to control, or eventually shut down after the regulator takes it seriously.
“I advocate freedom of speech, but these live streams are causing practical problems, and people break the law in live streams. When mainstream media learn about this, this will trigger a closure,” Ohtamaa said.
Alon acknowledged on X that Pump.fun’s audit was “not perfect”, adding that the NSFW (work insecure) switch could be turned on to hide extreme videos.
In the United States, Section 230 of the Communications Code Act provides some form of immunity for platforms that host user-generated content.
While platforms are usually protected, they must be responsible when reviewing content.Failure to do so, especially if they intentionally allow harmful content, can lead to legal challenges.For example, in Barnes v. Yahoo.In the United States, courts believe that the platform’s commitment to remove harmful content may be liable if it is not fulfilled.
Alon said Pump.fun has a “sized” review team that “works day and night” while inviting community members to tag unaudited content or tokens to its support channels.
On November 25, Pump.Fun’s live broadcast board showed some pornographic and racist content.
There are many examples of animal cruelty and violent content that can be seen in a total of four pages, all of these contents seem to have been deleted in the end.
Pump.fun is a paradise for Meme coins, but most are accused of cheating users.
The platform’s welcome note for tourists claims that it prevents Rug Pull and issuing tokens is not that difficult.
In a recent live stream, a teenager created a token and then allegedly threw it to his investors for $30,000, and then raised his middle finger to the audience with two middle fingers during the live stream.
Teenager suspected of Rug Pull on the scene.Source: TikTokInvestors
Some porn live streams have been accused of playing videos recorded by adult content creators on other platforms, which are used as title parties just to attract investors.
According to Dune Analytics,More than 3.8 million tokens have been issued through Pump.
The success rate of these tokens is very low.It is estimated that only 1.2% of the tokens will succeedachieveWhat is required to list on decentralized exchanges such as Raydium$69,000 market capitalization.
This may be attributed to several factors,For example, oversaturation and poor marketing of tokens, as well as scams and frauds.
“This doesn’t bode well for the industry,” said Mads Eberhardt, senior crypto analyst at Steno Research. “I believe that the snowballing effect of more and more institutions adopting Bitcoin is unstoppable, but if not simultaneously,” he said.In this case, the Bitcoin industry will be in a better position.”
Brisov of Digital and analog Partners said existing laws cover fraud involving cryptocurrencies.In the case of Pump.fun, token creators may be responsible for telecom fraud, a white-collar crime that occurs through electronic means including the Internet.
Pump.fun’s threat comes from more than just the U.S. Department of Justice
“For reasons I can’t understand, entrepreneurs who deal with Meme coins think the law does not apply to them,” Brisov said.
“If you are doing a shuffle deal, if you cheat on Pump.fun, the same law will apply to you, [US] the Justice Department will come to you, you will be prosecuted and jailed for years,” he warnedexplain.
Pump.fun does not significantly display terms and conditions or disclaimers on their websites like many other sites.If any formal investigation or lawsuit is initiated against the platform, their absence may be used to target the platform.
Brisov saidThe Justice Department is not the only agency that Pump.fun should worry about.
“Any token may be considered a securities, which means there is a high risk of unregistered securities issuance, which also violates the Securities Act and relevant EU regulations.”He said.
