Macauley Peterson

The alleged exploiter of Solana memecoin protocol Pump dot Fun has been arrested in London.



British police apprehended Jarett Dunn, a former contractor for the protocol, who is known online as @STACCoverflow, in the early morning hours of Saturday, according to a source familiar with the operation.



A third-party stakeholder contracted with a private intelligence firm to locate Dunn, the source told Blockworks.



A <a href="https://x.com/therollupco/status/1791882191229591666">screenshot</a> of Dunn’s Binance account linked to his pseudonym and circulating online is authentic, the source confirmed.



Read more: <a href="https://blockworks.co/news/pump-fun-flash-loan-attack">Pump.fun pauses trading after apparent flash loan attack</a>



The 26-hour intelligence operation, which the source described as “a slow burn,” used Instagram posts and other “open source intelligence” to identify Dunn’s approximate whereabouts in London.



“A massive manhunt” using local operatives, known as “auxiliaries,” contracted by the firm, then ensued.



After canvasing the area, Dunn was ultimately located in a room at the Middle Eight Hotel, in London’s Covent Garden neighborhood, where he was arrested 7 hours later.



The timing aligns with the last X post of <a href="https://x.com/STACCoverflow">@STACCverflow</a>, made Friday evening London-time. The profile name references “j&#8217;arrête” — meaning “I’m done” in French — but appears to carry a hidden double meaning to his real first name, Jarett.



Read more: <a href="https://blockworks.co/news/lightspeed-newsletter-pump-fun-exploit-resolved">Lightspeed Newsletter: The Pump.fun exploit draws yawns and jeers</a>



Dunn was subsequently released on bail according to @JarettDunn on X, and confirmed by the intelligence firm source.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I am once again without any of my 2fa for a lil while. I spent overnight in custody as the pump team alleges I stole 2m of their Ill gotten gains with conspiracy to steal another 80m. /x <a href="https://t.co/D8CBjdB9nG">https://t.co/D8CBjdB9nG</a>&mdash; free stacc (@jarettdunn) <a href="https://twitter.com/jarettdunn/status/1791968019322638835?ref_src=twsrc%5Etfw">May 18, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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He is expected to remain in the UK pending a further court-mandated appearance in August.



Dunn is alleged to have exploited admin keys to the protocol and was able to siphon roughly $2 million in funds from newly launched memecoins over a period of approximately 100 minutes last week, then randomly <a href="https://x.com/Vybe_Network/status/1791567178140922005">airdropping</a> the proceeds to Solana users.



The team then redeployed the smart contracts under new admin privileges to restore safe access, <a href="https://x.com/pumpdotfun/status/1791235050643636303">according</a> to the site’s official X account, and has pledged to compensate adversely affected users, while pursuing the perpetrator.



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Pump dot Fun exploiter identified and arrested in London

Shalini Nagarajan

Crypto startups, engagement farmers and memecoin fans beware: UK authorities may soon come for crypto memes.&nbsp;



The Financial Conduct Authority (FCA) wants to modernize its rules around online financial product promotions to better enforce compliance on social media. 



Its most recent guidance, published in 2015, doesn’t mention crypto at all. The FCA has now opened a consultation on whether to bring crypto memes under the remit of those official UK rules.



“Firms are reminded that any type of communication is capable of being a financial promotion and subject to S21 [part of the law governing financial promotions],&#8221; the agency said.



&#8220;We have seen memes and other similar communications circulated on social media with users often not realizing they are subject to our rules.&#8221;



This means financial promotion restrictions could extend to memes on platforms like Twitter, Reddit and Telegram. Some projects (memecoins) <a href="https://blockworks.co/news/gensler-memecoin-outperforms-market" target="_blank" rel="noreferrer noopener">base almost their entire value proposition</a> on memes, with the FCA saying promotions featuring memes are &#8220;particularly prevalent&#8221; in crypto.


<div class="wp-block-image">
<figure class="alignright size-large is-resized"><img loading="lazy" decoding="async" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=1024&amp;h=1024" alt="" class="wp-image-62133" width="479" height="509" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=1144 1144w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=283 283w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=965 965w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=242 242w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=246 246w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=206 206w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-18-at-11.13.26-1.png?w=75 75w" sizes="(max-width: 479px) 100vw, 479px" /><figcaption class="wp-element-caption">Example of a promotional crypto meme from FCA</figcaption></figure></div>


By providing clear guidelines on memes, the FCA aims to prevent misleading or deceptive practices in online promotional activities.



“We want people to stay on the right side of our rules, so we’re updating our guidance to clarify what we expect of firms when marketing financial products online,” said Lucy Castledine, the FCA’s director of consumer investments.&nbsp;



“And for those touting products illegally, we will be taking action against you.&#8221;



The FCA’s posturing comes as part of broader efforts to regulate crypto advertisements targeting UK consumers.



A marketing campaign for memecoin floki inu (<a href="https://blockworks.co/price/floki" target="_blank" rel="noreferrer noopener">FLOKI</a>), which included advertisements across the London Underground, was <a href="https://www.theguardian.com/technology/2022/mar/02/watchdog-bans-floki-inu-cryptocurrency-campaign-on-london-tube-elon-musk" target="_blank" rel="noreferrer noopener">shut down by UK authorities</a> last year.



Earlier this month, the regulatory authority <a href="https://blockworks.co/news/crypto-uk-ads" target="_blank" rel="noreferrer noopener">announced that crypto firms must comply with new advertising rules</a> by Oct. 8, or risk imprisonment or unlimited fines. 



Scrutiny of casual communications in financial promotions is happening outside the UK, too.&nbsp;



In February, a New York federal judge <a href="https://www.theregister.com/2023/02/27/emoji_financial_advice/">ruled</a> that emojis — rocket ships, money bags and stock charts — in promotions for Dapper Labs&#8217; NFT project NBA Top Shots could be financial advice implying potential returns on investment.



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Crypto memes could soon be regulated in the UK

The creator of the Grumpy Cat meme has issued a cease-and-desist letter to Twitter user &#8220;SlumDOGE millionaire,” urging him to refrain from pushing a memecoin that potentially violates their intellectual property rights.



An official letter was issued to Glauber Contessoto via NFT last week addressing promotion of a token named GrumpyCat, which it sees as engaging in clear and intentional infringements.



The letter <a href="https://etherscan.io/nft/0x495f947276749ce646f68ac8c248420045cb7b5e/25255182742691602014208176915599719490038371429987235854944699893102621491201" target="_blank" rel="noreferrer noopener">states</a> Grumpy Cat Limited has neither authorized nor provided consent for the use of its trademarks in association with this particular cryptocurrency offering.



In a tweet on Tuesday, the creator of the Grumpy Cat meme called out Contessoto for endorsing unauthorized offerings that continue to infringe on GCL&#8217;s intellectual property rights. The tweet described these endorsements as a “sad attempt” to scam unsuspecting traders.



“Do not be fooled by these scammers or their lies. No legal issues have been resolved. GCL will never approve such scam coins,” the creator said.



The tweet followed <a href="https://twitter.com/ProTheDoge/status/1660678190107590656">Contessoto&#8217;s claim</a> that the intellectual property concerns surrounding the Grumpy Cat token had been resolved. Etherscan shows the project has around 2,900 holders (Blockworks urges due diligence when interacting with memecoins, always do your own research!)



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"><a href="https://t.co/8xiw5AL1JC">pic.twitter.com/8xiw5AL1JC</a>&mdash; Grumpy Cat (@RealGrumpyCat) <a href="https://twitter.com/RealGrumpyCat/status/1660715304341901313?ref_src=twsrc%5Etfw">May 22, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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Meme creators typically don&#8217;t have copyright control over their creations, but the original copyright holders of the material used in memes can take action against memecoins or other uses of their copyrighted content.&nbsp;



“Pepe the Frog” Matt Furie <a href="https://www.theguardian.com/books/2019/jun/13/pepe-the-frog-creator-wins-15000-settlement-against-infowars" target="_blank" rel="noreferrer noopener">famously</a> sued Alex Jones’ Infowars over its sale of posters featuring the meme, winning a $15,000 settlement in 2019. A memecoin leveraging the popularity of Furie’s Pepe the Frog <a href="https://blockworks.co/news/pepe-memecoin-red-flags-abound" target="_blank" rel="noreferrer noopener">recently made headlines</a> for attracting significant investor interest.



While memecoins struggle with the concept of copyright, leveraging NFTs as a means of serving legal documents is becoming more common, particularly when faced with the challenge of unknown or unverifiable identities



Last week, Loevy &amp; Loevy attorney Mike Kanovitz <a href="https://twitter.com/MikeKanovitz/status/1659611715623960579" target="_blank" rel="noreferrer noopener">demanded a settlement</a> pseudoynmous memecoin creator Ben.eth <a href="https://www.nftscan.com/0x9133f0621b5a6900c3c6d02cb5155d3b50f712a1/32" target="_blank" rel="noreferrer noopener">via an NFT</a>, alleging wire fraud during a $7 million token pre-sale.



In a separate instance this year, a US judge ordered an anonymous group of hackers to reimburse one of their victims with $1 million USDT.



This ruling, which took place in the Southern District of Florida, <a href="https://decrypt.co/123502/plaintiff-beats-anon-hackers-served-court-papers-via-nft" target="_blank" rel="noreferrer noopener">upheld</a> the plaintiff&#8217;s decision to use NFTs to deliver the legal documents to the unidentified hackers.



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Memecoin