Solana Meme tide is fading, PumpSwap has rushed to a "latecome"?

Author: KarenZ, Foresight News

In 2024, Pump.fun quickly rose with its innovative token creation model and became an important driving force in the Solana ecosystem Meme token boom. However, with the rise and fall of the Solana ecological Meme market, Pump.fun faces multiple challenges: the stable position of mature DEXs such as Raydium and Jupiter in the trading field, and the gradual decline of users' enthusiasm for Meme tokens, the competitive pressure of the BSC network has hindered the growth momentum of Pump.fun, prompting the Pump.fun team to re-examine their development strategies.

Just early 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 transaction. Can the launch of PumpSwap inject new vitality into Pump.fun? Recreate its glory in the Meme token space?

What are the features of PumpSwap?

PumpSwap uses a constant product AMM model similar to Raydium V4 and Uniswap V2. The biggest change in PumpSwap is the cancellation of the intermediate step of moving tokens from Pump.fun to external DEX (Raydium). All "graduate" tokens that complete the joint curve will create a liquidity pool and start trading directly on PumpSwap.

The core features of PumpSwap include:

1. Seamless token migration : From now on, all tokens that complete their joint curve will be directly migrated to PumpSwap instead of Raydium that was previously dependent, and there is no need to pay the migration fee (previously 6 SOL). This change eliminates the economic barriers for token creators to enter 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. Broad token support : PumpSwap not only supports all Meme tokens graduated from Pump.fun, but also adds transaction support for multiple popular project tokens, including PENGU, APT, TRON, cbBTC, USDe (Ethena), FXS, fxUSD, SEI, JUP, ZRO, MNDE, MPLX, DRIFT, PLUME, RETARDIO, SAVE, SCR, OX, W, etc. Among these tokens, APT (Aptos) and TRON are connected to the Solana ecosystem through PumpSwap for the first time, demonstrating the platform's ambition to expand compatibility.

4. Fees : PumpSwap charges a 0.25% handling fee for each transaction, of which 0.20% is allocated to the liquidity provider and 0.05% belongs to the agreement.

5. Creator share : "Creator share system" is also a highlight of PumpSwap. PumpSwap shares some of the protocol revenue with token creators, aiming to incentivize higher quality Meme projects. The details of fee allocation will be further adjusted after the feature is launched.

In terms of security, PumpSwap has passed 9 security audits conducted by Pashovgroup, OtterSec, bl0ckpain and Sec3, etc., and promises to open source code in the future to enhance community trust. pump.fun is currently conducting a PumpSwap audit competition with Cantina, a market application for Web3 security solutions, with a total reward of US$2.01 million.

What are the advantages and challenges of Pump.fun?

Pump.fun believes that the migration of tokens after graduation from Pump.fun is a major friction point, which will slow down the development momentum of tokens and bring unnecessary complexity to new users.

The launch of PumpSwap attempts to address long-standing pain points and seize new market opportunities. First, the policy of free migration and creating liquidity pools has significantly lowered the threshold for user participation, especially for small-scale investors and token creators, which enhances the platform’s appeal.

In the past, tokens had to be manually moved to Raydium after graduation from Pump.fun. This process is not only time-consuming, but also may miss the short-term window of Meme tokens. PumpSwap integrates trading functions natively, allowing users to enter the market instantly and capture opportunities as soon as possible.

The upcoming creator sharing mechanism is expected to inspire more developers to invest time and creativity to create more attractive Meme projects by sharing protocol revenue with token creators, thereby improving 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 highlights the fragility of the market. If the market continues to cool down, PumpSwap's trading volume and revenue will face severe tests.

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

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

summary

The launch of PumpSwap is Pump.fun's active response to market changes and a key step for it to take from a single launch pad to a comprehensive Meme trading ecosystem. By eliminating transaction friction, improving efficiency and motivating creators, PumpSwap has demonstrated mature design ideas at the technical level. The PumpSwap platform directly extends the token life cycle to the trading stage, forming a complete closed loop of "transmission-transaction-incentive".

At the same time, Raydium, as the most liquid and trading volume DEX in the Solana ecosystem, benefits to some extent from Pump.fun's Meme token migration. The launch of PumpSwap directly cut off this traffic source, leaving Meme token trading internally, resulting in a shrinking Raydium market share. However, Raydium also plans to launch LaunchLab to compete with Pump.fun.

In addition, the Solana ecosystem has not seen similar phenomenal projects for a long time, resulting in a significant cooling of users' enthusiasm for Meme tokens within the ecosystem, casting a shadow on the prospects of PumpSwap. Although PumpSwap's creator incentives have potential, it is still doubtful whether it can quickly reverse this trend, especially when it is difficult to spawn popular products in the short term.

In the future, if PumpSwap can produce one hot Meme after another and break the stalemate of the weak market, it is expected to occupy a place in the Solana ecosystem. Otherwise, it may become another attempt after the craze subsides, and it will be difficult to reproduce the glory of Pump.fun.