Pump.fun Challenges and Opportunities in the Meme Launchpad Market

Over the past year, the Launchpad market of Meme coin issuance platforms on Solana has experienced explosive growth and quickly formed a fiercely competitive landscape.

Author: BUBBLE

Over the past year, the Launchpad market of Meme coin issuance platforms on Solana has experienced explosive growth and quickly formed a fiercely competitive landscape. Among them, Pump.fun, as the earliest emerging platform, can be regarded as a catalyst for the prosperity of Solana's "on-chain casino". The platform allows any user to issue tokens without any threshold, adopts binding curve pricing, and creates a fair issuance model without pre-sales and team shares.

With the advantages of Solana's low cost and high-speed transactions, Pump.fun set off a meme coin craze in 2024. In just 13 months, platform users issued more than 8 million tokens. At the peak on October 24, 2024, more than 36,000 tokens were issued in a single day, with an average of 25 new tokens being created every minute. This unprecedented scale of token creation made Pump.fun monopolize the market for a time, and also made Solana known as the largest "casino" on the chain. However, Pump.fun's success also brought hidden worries. On the one hand, a large number of low-quality projects emerged, with a graduation rate of less than 1%, and most tokens were short-lived. On the other hand, the platform was profitable but users generally lost money. Statistics show that nearly 90% of users lost their principal or made less than $100 in meme coin transactions, while the platform earned about $98 million in just 6 months.

As of the end of 2024, Pump.fun's official revenue has accumulated to more than 223 million U.S. dollars (about 1.15 million SOL), and it continues to cash out the SOL it has earned. In just one and a half years, the platform fee account sold about 3.403 million SOL (about 629 million U.S. dollars), becoming the second largest source of selling pressure after FTX/Alameda, an early investor in Solana. Such a huge outflow of funds has aroused the community's concerns about the sustainability and ecological impact of the platform.

Faced with the situation where Pump.fun is the only one, market participants acted quickly, and the entire Meme Launchpad track entered a white-hot competition. In the Solana ecosystem, Raydium, a long-established decentralized trading platform, launched LaunchLab to compete with Pump.fun; the popular meme coin BONK opened the LetsBonk.fun launch pad; and the on-chain aggregator Jupiter also tried to launch similar services. Among them, LaunchLab is the main competitor to Pump.fun. Its on-chain Degen strategy and Slashdot-style topics have attracted the attention of a large number of users.

Pump.fun Challenge

A pioneer of the one-click launch platform for meme coins, Pump.fun has established a basic operating model. Users only need to fill in basic information such as the token name and symbol, and can automatically deploy the token contract and establish a trading pool without programming skills, which greatly reduces the threshold for issuing coins. The platform adopts a variety of binding curve pricing models to balance the initial price and market demand. The issued tokens can be traded immediately in the platform's AMM pool without the need to inject liquidity in advance.

The platform innovatively introduces an LP share destruction mechanism. When a new coin reaches a certain market value threshold, it will automatically inject part of the liquidity into the Raydium trading pool and destroy the corresponding LP tokens, ensuring that the project party cannot withdraw from the pool and run away, thereby improving liquidity security.

With the experience of "no code to issue coins, instant transactions", Pump.fun quickly became popular in 2024, giving rise to a large number of creative meme tokens, some of which have increased by 100 times or even 1,000 times, attracting many speculators. The platform has become one of the most profitable on-chain applications in 2024 by extracting transaction fees.

However, as it developed, Pump.fun's problems gradually emerged: less than 1% of the more than 8 million issued tokens successfully "graduated" into the external liquidity pool; user benefits were severely polarized, forming a zero-sum game; the platform cashed in the handling fees and continued to sell SOL, causing selling pressure on the Solana network; the completely anonymous and audit-free model was in line with the spirit of encryption, but it brought regulatory and trust issues. As a result, Pump.fun's growth slowed down in early 2025, and its daily trading volume fell from a peak of US$544 million in January to US$270 million in February, a drop of nearly 50%.

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