Solana Coin CatFi Soars After Creators Charged

South Korean prosecutors have charged five individuals in connection with a "rug pull" involving the Solana meme coin CatFi, marking the first application of the country's new Virtual Asset User Protection Act [2]. Following the announcement, traders drove the price of the dormant token up nearly 6,000% in an effort to "unrug" the project [2]. The scheme allegedly caused approximately $600,000 in damages to 256 investors [2].

Key takeaways

• Five people were charged over a Pump.fun rug pull, marking the first use of South Korea's Virtual Asset User Protection Act [2].
• CatFi creators allegedly caused $600,000 in damages to 256 investors by mass selling tokens shortly after launch [2].
• The token surged 6,000% after the arrests, though it remains 96% below its February 2025 peak [2].

Legal action against CatFi creators

According to the Seoul Southern District Prosecutors' Office, the defendants launched CatFi on the Solana launchpad Pump.fun in February 2025 [2]. The token briefly reached a market capitalization of $8.37 million before crashing to $12,170 within hours due to "mass selling" by the creators, a tactic defined by prosecutors as a rug pull [2]. Authorities allege the group pocketed over 400 million won ($267,000) while inflicting 900 million won ($600,000) in losses on investors [2]. Two individuals responsible for social media promotion have been arrested, while three others involved in the technical aspects of the scheme have been charged but not arrested [2].

Traders attempt to revive the token

Despite the alleged fraud, market reaction to the legal news was unexpectedly positive [2]. Traders pumped the token from a market cap of $2,350 to roughly $167,000, an increase of almost 6,000% in less than a day [2]. Prior to this surge, the token had not recorded a single buy since August 2025, according to block explorer SolScan [2]. A new X account for the token has been created, with claims of wanting to "unrug" the asset, though it still trades 96% below its February 2025 peak [2].

Why it matters

This case represents South Korea's first prosecution of a crypto crime executed on a decentralized exchange and sets a legal precedent under the new Virtual Asset User Protection Act [2]. Nick Vaiman, co-founder of blockchain analytics firm Bubblemaps, noted that previous community investigations into rug pulls often failed due to a lack of legal consequences, suggesting this move could lead to more justice for retail investors [2]. The price surge highlights a counter-intuitive market trend where criminal charges can generate speculative interest, illustrating the volatile nature of meme coin trading [2].