The Financial Conduct Authority of the United Kingdom has listed Solana-based meme coin launchpad Pump.fun in its warning list for operating without proper authorization. After the warning, Pump.fun has blocked users’ access in the UK since December 3.
Unauthorized Operations Spark Concerns
In its statement, the FCA said, “This firm may be providing or promoting financial services or products without our permission. You should avoid dealing with this firm and beware of scams.”
The FCA was concerned that Pump.fun was targeting UK residents while it was not authorized to do business in the country. Therefore, the regulator warned users against using the platform because of the risks involved.
Access to be Blocked for UK Users
Pump.fun introduced a geoblocking feature for users in the UK, putting up the following message on its website:
“Restricted jurisdiction. Our systems have detected that you are in the United Kingdom. In accordance with the laws and regulations of the United Kingdom, this site is currently unavailable to users in the United Kingdom”.
UK-based users are asked to withdraw coins deposited via a link provided, but Pump.fun hasn’t made any public comment on the FCA’s warning through its official X account or Telegram channel.
Controversies Continue to Pile up for Pump.fun
Pump.fun, since its launch in January of 2024, has found itself in the middle of various controversies:
- May 2024: Livestreaming dangerous stunts, such as self-harm and threats toward animals, sparked outrage.
- In October 2024, child sexual abuse material was discovered on the platform, indicating some weakness in its moderation policies.
- In November 2024, despite these controversies, 62% of all Solana transactions came from Pump.fun, according to analytics platform Dune Analytics.
- These incidents have sparked serious questions over the operations and ethical standards of the platform.
FCA Highlights Financial Risks
The FCA warned users of unauthorized platforms, including Pump.fun, run significant risks of financial losses. Users of a non-FCA-authorized service do not have any legal protections from scams, and recovery of their funds may be challenging in such cases.
Uncertain Future Amid Regulatory Scrutiny
While Pump.fun has achieved notable transaction volumes, its ongoing legal and ethical challenges, coupled with regulatory pressures, cast doubts on its sustainability. Its ability to navigate these issues while maintaining user trust remains uncertain.
