98.6% of Tokens Launched on Pump.fun Are Rug Pulls or Pump-and-Dump Schemes, Causing Billions in Retail Losses

Solana-based token launchpad Pump.fun enables anyone to create and list a token in seconds with near-zero cost, but 98.6% of the approximately seven million tokens launched on the platform have been rug pulls or pump-and-dump schemes, with only 97,000 maintaining at least $1,000 in liquidity. Why it matters: the zero-friction token creation model attracts bad actors who launch tokens with insider-held supply and artificial early volume, so retail investors see rapid price increases and buy in during the pump phase; so insiders dump their pre-allocated holdings within minutes to hours, crashing the token 90-99%; so individual retail traders -- disproportionately younger and less experienced investors lured by social media hype -- lose their entire investment with no recourse; so trust in the broader Solana DeFi ecosystem erodes, driving legitimate projects to other chains; so the pattern repeats at industrial scale because there are no enforceable consequences, with 93% of liquidity pools on Raydium also exhibiting soft rug pull characteristics. The structural root cause is that permissionless token creation platforms have no mechanism to verify token creator identity, enforce lockup periods, or require minimum liquidity commitments, and existing securities fraud laws are not enforced against pseudonymous on-chain actors operating across jurisdictions.