Most Tech Altcoins Are Just VC-Backed Meme Coins, Says Pump.fun Founder
In a social media post dated February 3, 2025, Alon Cohen, co-founder of Pump.fun, criticized tech-focused altcoins by equating their value propositions to those of meme coins, albeit with notable drawbacks. Cohen highlighted these altcoins' low circulation, inflated valuations, and the strategic involvement of venture capitalists using retail investors as exit liquidity. His remarks were in response to claims that Pump.fun's meme coin platform disrupted the altcoin market cycle.
Cohen countered , noting its launch predated the broader market downturn in April 2024.
"Retail investors were severely impacted in the last cycle, making them reluctant to re-invest in what is dubbed the 'future of finance,'" Cohen stated. He attributed the altcoin market crash to fading interest among ordinary investors.
According to Cohen, most people prefer investment opportunities that are straightforward and enjoyable, rather than engaging with complex tech narratives. His observations underscore the tension between altcoin enthusiasts focused on technology and speculative traders unconcerned about long-term viability.
Pump.fun, launched in January 2024, gained traction by tapping into the memecoin trend driven by online platforms like X (previously Twitter), Reddit, Telegram, and Discord.
At its peak in March 2024, the Total3 index on TradingView—tracking crypto market capitalization excluding Bitcoin and Ether—reached around $788 billion.
However, a significant market decline followed in April 2024. Altcoins struggled to rebound, with a brief recovery occurring in November due to a major rally linked to Donald Trump's U.S. re-election. Analysts warn of market oversaturation amid fierce competition for investor attention, though altcoins with institutional backing fared better in 2024.
Recently, Pump.fun has faced legal challenges from Burwick Law and Wolf Popper LLP. These firms claim trademark violations and improper brand impersonation involving over 200 tokens on the platform, filing a lawsuit and issuing a cease and desist notice. One contentious token, ‘Dog Shit Going NoWhere’ (DOGSHIT2), was reportedly launched without consent.
The law firms clarify they have no ties to these meme coins and are pursuing legal remedies to protect their intellectual property. They also argue Pump.fun can remove these infringing tokens but has opted not to, disregarding potential ramifications for investors. Additionally, allegations include Pump.fun's role in facilitating tokens intended to harass individuals involved in the legal proceedings.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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