Meteora is Being Sued after Alleged Pump and Dump Scheme! More than $50 Million of Investor's Money is Gone

Meteora, a decentralized exchange (DEX) built on Solana, is facing severe legal trouble after being accused of orchestrating a massive pump and dump scheme involving the M3M3 meme coin. The lawsuit, filed in New York, alleges that Meteora and its founder, Benjamin Chow, defrauded investors through insider manipulation leading to losses estimated at over $69 million, with over $50 million attributed to retail investors.

The suit centers around the controversial launch of the M3M3 token on Meteora’s platform, which was allegedly advertised as a community-driven meme project. However, the plaintiffs argue that the token launch was anything but transparent.

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Meteora Solana’s DEX Accused of Insider Manipulation

According to the court filing, more than 150 insider wallets were used to control nearly 95% of M3M3’s total supply within just 20 minutes of its release. The plaintiffs claim that this was a calculated move to inflate the token's price artificially and dump it onto unsuspecting investors shortly after.

The legal team representing the plaintiffs, including crypto-focused firms Burwick Law and Hoppin Grinsell LLP, stated:

“The M3M3 launch was never public in the true sense. Instead, it was a tightly orchestrated insider deal disguised as a decentralized opportunity.”

This revelation comes at a time when the crypto community has grown increasingly cautious of so-called “community tokens” on decentralized platforms. The Meteora Solana DEX, once praised for its innovation in staking and meme coin dynamics, now faces serious reputational damage as its involvement in the token launch becomes clearer.

Allegations Deepen: Connections to LIBRA Scandal Surface

What’s more concerning is the link between this new lawsuit and a previous scandal involving the LIBRA token, another meme coin allegedly promoted by the same group. That case, which shook Argentina’s crypto scene earlier this year, involved political fallout and an Interpol arrest request for one of the defendants, Hayden Davis.

Plaintiffs argue that both M3M3 and LIBRA were coordinated pump and dump operations, falsely marketed to create hype before insiders cashed out. The Meteora Solana platform played a central role in launching both tokens, suggesting a troubling pattern.

The Impact: M3M3 Token Value Crashes by Over 98%

Following its December 2024 launch, M3M3 briefly surged to an all-time high of $0.186, only to crash more than 98% now trading at just $0.003. According to the suit, this crash was not due to market volatility but instead a deliberate and hidden strategy by insiders to exit positions at the top, leaving retail investors with worthless tokens.

This kind of manipulation undermines trust in DEX platforms like Meteora, which are often marketed as fair, transparent alternatives to centralized exchanges.

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What’s Next for Meteora and the Future of Solana DEX Projects?

As this class action lawsuit unfolds, questions are being raised about due diligence, transparency, and token launch ethics within the Solana DEX ecosystem. If the allegations prove true, it could prompt stricter regulatory oversight on how tokens are launched and promoted on decentralized platforms.

While Meteora and the other named defendants have yet to publicly respond, the lawsuit has already sent shockwaves through the crypto community. Investors are being urged to research thoroughly before participating in meme coin launches—especially on emerging DEX platforms like Meteora Solana.

FAQ

What is the lawsuit against Meteora Solana DEX about?

The lawsuit alleges that Meteora Solana, a decentralized exchange (DEX), and its founder orchestrated a pump and dump scheme involving the M3M3 meme coin. Plaintiffs claim that insiders controlled 95% of the token supply during its launch, leading to over $69 million in investor losses.

How was the M3M3 token manipulated on the Meteora DEX?

According to the complaint, 150 insider wallets were used to buy up nearly all available M3M3 tokens within 20 minutes of launch. This gave the appearance of high demand, artificially inflating the token's value before insiders allegedly sold off at peak prices, causing massive losses for regular investors.

What impact could this lawsuit have on other Solana DEX projects?

The Meteora Solana scandal could trigger increased regulatory scrutiny on DEX platforms and meme coin launches. It raises concerns about transparency and insider manipulation, potentially affecting investor confidence in similar decentralized exchanges across the Solana blockchain ecosystem.