Pump.fun Launches PumpSwap DEX, Moves Away from Raydium
Pump.fun has introduced its own decentralized exchange (DEX), PumpSwap, signaling a shift away from Raydium as the primary trading platform for Solana (SOL) memecoins.
Key Highlights
- Pump.fun launches PumpSwap, its own decentralized exchange.
- Previously, Pump.fun tokens migrated to Raydium after liquidity bootstrapping.
- Starting March 20, tokens bonded on Pump.fun will migrate directly to PumpSwap.
- PumpSwap aims to reduce friction and complexity in token migrations.
- Raydium recently announced its own memecoin launchpad, LaunchLab, intensifying competition.
Reducing Friction for Users
Pump.fun stated that PumpSwap operates similarly to Raydium V4 and Uniswap V2, aiming to create a seamless trading environment. The new DEX eliminates the delays and complexities associated with token migrations, allowing instant and free transfers.
Competition Heats Up
The launch of PumpSwap comes shortly after Raydium revealed plans for LaunchLab, a memecoin launchpad designed to compete directly with Pump.fun. This shift from partnership to competition could significantly reshape Solana’s decentralized finance (DeFi) landscape.
“We welcome competition because users win at the end of the day,” said Alon, a Pump.fun co-founder.
Other emerging platforms, including Daos.fun, GoFundMeme, and Pumpkin, are also competing for market share. PumpSwap plans to adopt revenue-sharing features popularized by GoFundMeme, incentivizing creators by sharing protocol revenue.
Declining Memecoin Activity
Memecoin trading activity has significantly declined since January, following several scandals that dampened retail investor enthusiasm. Pump.fun’s daily fee revenue dropped from over $4 million in January to approximately $1 million by mid-March.
Despite the recent downturn, memecoins were a major growth driver for Solana in 2024, boosting the chain’s total value locked (TVL) from $1.4 billion to over $9 billion. Raydium benefited greatly, with daily trading volumes rising from $245 million to over $2 billion during the same period.
In January, Raydium also launched a leveraged perpetual futures platform to compete with Jupiter, another leading Solana DeFi protocol.
