Pump.fun and its co-founder account were banned by X. What caused this wave of "account bans" in the cryptocurrency circle?

Author: Bitpush

In the early morning of June 17th, Beijing time, the X (formerly Twitter) platform once again experienced a large-scale account ban incident, and the official account of the popular Meme token platform Pump.fun and its co-founder Alon was not spared. This was another large-scale account ban after the June 12th. Dozens of crypto KOLs and project accounts, including the GMGN ecosystem core account and the Bloom Trading team, were banned simultaneously. A "banning storm" against the crypto industry is sweeping across X.

According to community tracking, in addition to Pump.fun, a large number of GMGN-related accounts and other independent KOL and project accounts have been banned.

These include:

GMGN related accounts:

@gmgnai
@haze0x (Founder)
@arthur_gmgn (Co-founder)
@Ga__ke (linked account)
@brc20niubi (linked account)
@Wolfy_XBT (linked account)
@0xcryptowizard (linked account)
@ivyflame (Team Member)
@gmgnaiJapanese

Bloom related accounts:

@BloomTrading
@imBFFF00 (Team member)
@nftraian (Team Member)
@CookerFlips (Partner)
@vibed333 (linked account)

Other blocked accounts:

@bullx_io
@ElizaOS (Team)
@shawmakesmagic
@uxento
@Nuotrix_

In-depth analysis of community comments and reasons

Although the X platform has not yet given a clear official explanation, there are many speculations and analyses circulating in the community, trying to explain the reasons behind this large-scale account ban:

1. Serious violation of API usage regulations, X platform strictly cracks down on "black market" data acquisition: Analysts pointed out that some crypto applications such as Pump.fun, GMGN, Bloom and Uxento use Twitter trackers and snipers (tools that can quickly track tweets or wallets). However, these tools do not obtain data directly from X platform through legal channels, but allegedly use "black market" or shared APIs - unofficial or unauthorized methods of accessing X platform data.

X platform has begun to crack down on such behavior. There is a precedent. Another tool, WuupX, received a cease and desist letter for violating Twitter's terms of service. Now, other accounts using similar settings have also begun to be banned. This unauthorized data acquisition method is considered to be a "touch of the cake" of X platform, because X's official API fees for enterprises are as high as $42,000 per month. Unauthorized use for data crawling is very likely to violate the platform's terms of service and is considered abnormal access behavior or abuse of system resources.

2. Platform manipulation and spam: @sakakimay1995 and other users analyzed that some of the blocked accounts, especially ElizaOS and GMGN, may have an automatic publishing framework (agents automatically post on X), or generate a large amount of homogeneous content to guide users to buy Meme coins. This kind of mass-generated content with similar structures and lack of sufficient user interaction can easily be judged as spam or platform manipulation by the platform.

3. Allegations of “excessive withdrawal of liquidity” and potential fraud mechanisms: Crypto KOL Mary (@MaryWynnReal) pointed out that the founder of Pump.fun was banned by X, which may be related to an abnormal situation called “Liquidity Harvesting 2.0”. Mary said that this is an alleged mechanism by which funds in user wallets mysteriously disappear and reappear in suspicious wallets.

She also mentioned that the move came hours after the platform’s internal review suggested that it may have “accidentally over-innovated in financial concepts.” In addition, the Pump.fun homepage was nicknamed “Slot Machine of DeFi” by users, a name that allegedly attracted the attention of “regulatory interns who have little time and only a superficial understanding of crypto memes.”

4. Rumors about the "AutoRug" feature: Mary's comments further revealed that an insider said that the founder of Pump.fun had been developing a new feature called AutoRug, which is designed to save time for developers and "exit liquidity participants" (i.e. high-level buyers). A Telegram administrator described it this way: "It's really efficient. You publish a token, it Rugs itself, and then you receive a push notification. It's like Uber Eats, but it provides financial desperation."

5. Potential multi-jurisdictional violations: In addition to the “minor violation” of Rule X, the suspension may also be related to alleged violations in four jurisdictions, suggesting that the incident may involve a wider legal or regulatory level.

6. Rectification of Meme coin promotion accounts: Another view is that this wave of account closures may be a centralized rectification of accounts that frequently publish various Meme token contract addresses (CA) by the X platform. Considering the high risk of the Meme coin market and potential market manipulation (for example, the Pump.fun platform has a revenue of $1 billion in 2024, but only 0.4% of wallets are profitable, and 80% of Meme coins have plummeted), the X platform may be strengthening supervision of the promotion of such high-risk financial products.

7. Relatively "far-fetched" speculation: There are also some more "far-fetched" speculations, such as the release of Trump or Musk's emoticons, but this is generally not considered to be the main reason.

Community response and Pump.fun current status

The incident happened suddenly and on a large scale, causing many KOLs and project owners to have doubts about the content supervision mechanism of the X platform. The blocked accounts are appealing one after another. As of the time of writing, the Pump.fun official website and other channels are still active. The community discussion on this large-scale account blocking is still fermenting, and more details and the official response of the X platform remain to be seen.