Suspects detained in South Korea in case involving Solana memecoin CatFi

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Suspects detained in South Korea

How the fraudulent scheme worked

After launching CatFi, the suspects allegedly attracted investors through fake social media accounts. One of the main figures posed as an independent crypto influencer and urged users to buy the token. Another suspect managed the project’s official channel, artificially inflated follower numbers and published false statements about token lock-up plans to create an appearance of trust and activity around the project.

Investigators also believe the group used multiple wallets to distribute tokens and conducted wash trades to hide its control over a significant share of the supply.

According to prosecutors, CatFi’s price rose 1,001-fold within 26 hours of launch. During that period, around 6,000 investors bought the token. Of them, 256 reported combined losses of 900 million South Korean won, or about $600,000. The suspects, meanwhile, allegedly made more than 400 million won in profit.

On-chain investigators had previously identified the suspects and the wallets linked to them before passing the information to authorities. However, police closed the case without a resolution after the individuals claimed they had allegedly been hacked.

Later, the Financial Services Commission referred the materials to prosecutors. A special unit for investigating virtual asset crimes worked with financial and tax authorities to track down the suspects. One of them had been hiding for about three months and used several disguises.

Two suspects were detained on May 11, and three more on Wednesday.

Prosecutors stressed that they intend to make participants in the crypto market who seek to get rich quickly through illegal methods understand that market manipulation will inevitably lead to serious financial and personal consequences.

A problem beyond one project

The CatFi case fits into the broader context of the Solana memecoin market. According to Solidus Labs, about 98.7% of tokens on Pump.fun and 93% of liquidity pools on Raydium showed signs of pump-and-dump schemes or rug pulls. This does not mean that every such project is automatically proven fraud, but it highlights the scale of the risks: many new tokens quickly lose liquidity, often leaving investors with devalued assets.

Trader statistics also point to an imbalance that works against retail participants. According to Dune Analytics data cited by industry media, most Pump.fun users traded at a loss during certain periods, while large profits went to a small share of wallets. That is why the CatFi case is important not only as a separate rug pull case, but also as a signal for the entire Solana memecoin market: regulators are beginning to treat such schemes not as an “ordinary crypto risk,” but as potential fraud and market manipulation.

As a reminder, the SEC classified SOL as a potential security.

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