Pump.fun launch of PumpSwap, can the Solana Meme ice be broken?

Original author: KarenZ, Foresight News

In 2024, Pump.fun has rapidly risen to prominence with its innovative token creation model, becoming a significant driver in the meme token boom in the Solana ecosystem. However, as the Solana ecosystem meme market ebb and flow, Pump.fun faces multiple challenges: the solid position of mature DEXs such as Raydium and Jupiter in the trading field, as well as the gradual fading of users' enthusiasm for meme tokens, and the competitive pressure on the BSC network, all of which have hindered Pump.fun's growth momentum and prompted the Pump.fun team to re-examine its development strategy.

In the early hours of this morning (March 21, 2025), Pump.fun officially announced the launch of its DEX, PumpSwap, marking the platform's transformation from a single token launch platform to a comprehensive platform integrating token launch and trading. Can the launch of PumpSwap breathe new life into Pump.fun? Recreating its glory in the meme coin space?

What does PumpSwap do?

PumpSwap employs a constant product AMM model similar to Raydium V4 and Uniswap V2. The biggest change for PumpSwap is the removal of the intermediate step of migrating tokens from Pump.fun to an external DEX (Raydium). All "graduating" tokens that complete the union curve will create liquidity pools and start trading directly on PumpSwap.

PumpSwap's core features include:

1. Seamless token migration: From now on, all tokens that complete their union curve will be migrated directly to PumpSwap instead of Raydium, which they previously depended on, and will no longer need to pay migration fees (previously 6 SOL). This change removes the economic barriers for token creators to access the trading market.

2. Free liquidity pool creation and provision: Users can create liquidity pools at no cost and provide liquidity to existing pools.

3. Wide range of token support:PumpSwap not only supports all meme tokens that have graduated from Pump.fun, but also adds trading support for several popular project tokens, including PENGU, APT, TRON, cbBTC, USDe (Ethena), FXS, fxUSD, SEI, JUP, ZRO, MNDE, MPLX, DRIFT, PLUME, RETARDIO, SAVE, SCR, OX, W, and more. Among these tokens, APT (Aptos) and TRON have been connected to the Solana ecosystem for the first time through PumpSwap, demonstrating the platform's ambition to expand compatibility.

4. Cost:PumpSwap charges a fee of 0.25% per transaction, with 0.20% allocated to liquidity providers and 0.05% owned by the protocol.

5. Creator Sharing: The "Creator Sharing" is also a highlight of PumpSwap. PumpSwap shares a portion of the protocol's revenue with token creators, aiming to incentivise higher-quality meme projects. Fee allocation details will be further adjusted once the feature goes live.

In terms of security, PumpSwap has passed 9 security audits conducted by Pashovgroup, OtterSec, b l0 ckpain, and Sec 3, among others, and promises to open source the code in the future to enhance community trust. pump.fun is currently running a PumpSwap audit competition with Cantina, a marketplace application for Web3 security solutions, with a total reward of 2.01 million USDC.

What are the advantages and challenges of Pump.fun?

Pump.fun believes that the token's post-graduation from Pump.fun is a major point of friction, which slows down the token's momentum and introduces unnecessary complexity for new users.

The launch of PumpSwap seeks to address long-standing pain points and seize new market opportunities. Firstly, the policy of free migration and the creation of liquidity pools significantly lowers the barrier to entry for users, especially for small-scale investors and token creators, which enhances the platform's appeal.

In the past, tokens had to be manually migrated from Pump.fun to Raydium after graduation, a process that was not only time-consuming but also could miss out on the brief boom window for meme coins. PumpSwap provides users with instant access to the market and the first to capture opportunities through native integration of trading features.

The upcoming creator sharing mechanism is expected to incentivise more developers to invest time and creativity in creating more attractive meme projects by sharing protocol revenue with token creators, thereby enhancing the overall quality and activity of the ecosystem.

However, PumpSwap's success is highly dependent on the continued prosperity of the meme token market within the Solana ecosystem. The LIBRA token crash in February 2025 highlighted the market's vulnerability. If the market continues to cool, PumpSwap's trading volume and revenue will be severely tested.

In addition, there are already mature DEXs such as Raydium and Jupiter in the Solana ecosystem, and PumpSwap, as a new player in DEX, needs to quickly prove its advantages in terms of functionality and user experience.

On the other hand, PumpSwap's low threshold may further amplify risks such as "soft rugs", which may lead to a further proliferation of low-quality tokens and harm the interests of ordinary investors. In a weak market, there is a higher risk of inferior token proliferation, which may further dampen user confidence.

brief summary

The launch of PumpSwap is Pump.fun's proactive response to market changes and a key step towards its transition from a single launch pad to a comprehensive ecosystem for meme trading. By eliminating transaction friction, improving efficiency, and incentivising creators, PumpSwap demonstrates a mature design idea on a technical level. The PumpSwap platform directly extends the token lifecycle to the transaction stage, forming a complete closed loop of "launch-trade-incentive".

At the same time, Raydium, as the most liquid and trading volume DEX in the Solana ecosystem, is partly due to Pump.fun's meme token migration. The launch of PumpSwap directly cut off this traffic stream, leaving meme token trading inside, leading to a decline in Raydium's market share. However, Raydium also plans to launch LaunchLab to compete with Pump.fun.

Additionally, the Solana ecosystem has not seen similar phenomenal projects for a long time, leading to a significant cooling of users' enthusiasm for meme tokens within the ecosystem, casting a shadow over PumpSwap's prospects. While PumpSwap's creator incentives have potential, it is doubtful that they can quickly reverse this trend, especially if it is difficult to spawn blockbusters in the short term.

In the future, if PumpSwap can run one popular meme after another, break the deadlock in the weak market, and hope to occupy a place in the Solana ecosystem, otherwise it may become another attempt after the boom subsides, making it difficult to recreate Pump.fun's former glory.

27.11K

The content on this page is provided by third parties. Unless otherwise stated, OKX is not the author of the cited article(s) and does not claim any copyright in the materials. The content is provided for informational purposes only and does not represent the views of OKX. It is not intended to be an endorsement of any kind and should not be considered investment advice or a solicitation to buy or sell digital assets. To the extent generative AI is utilized to provide summaries or other information, such AI generated content may be inaccurate or inconsistent. Please read the linked article for more details and information. OKX is not responsible for content hosted on third party sites. Digital asset holdings, including stablecoins and NFTs, involve a high degree of risk and can fluctuate greatly. You should carefully consider whether trading or holding digital assets is suitable for you in light of your financial condition.