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The Solana meme coin ecosystem has been one of the major talking points in this bull run, as crypto investors continue to bet on tokens that launch from the meme coin generator Pump.fun. However, Solana traders might be having a rethink as data from the on-chain analytics platform Dune shows a dwindling interest in these meme coins.
Pump.fun Sees Massive Decline
Data from Dune Analytics shows a massive decline in the number of weekly new addresses on Pump.fun, indicating a decline in interest in meme coins generated on the platform. During the week that ended on August 12, Pump.fun recorded 33,333 new addresses on its platform, a significant decline from the previous week when it witnessed 212,699 new addresses.
A bigger picture shows that the number of weekly new addresses on the platform has declined since the week ending on June 17th, when it peaked at 349,032 new weekly addresses. This decline can be attributed to various reasons. For one, the meme coin generator has been largely criticized for making it easier for scammers to carry out pump-and-dump schemes.
Anyone can deploy a meme coin through Pump.fun for as low as $2, a move which has undoubtedly led to an increase in rug pulls, whereby the token developers dump all their holdings on traders and suck up all the liquidity from the token. Moreover, the ease of creating a meme coin through Pump.fun has made the Solana meme coin ecosystem too saturated.
This has made meme coin trading on the Solana network less profitable and too much of a gamble, which explains why traders are losing interest in Pump.fun and, by extension, Solana meme coins. Crypto enthusiast Adam recently highlighted how Pump.fun has become a “slaughterhouse” for meme coin degens.
In an X (formerly Twitter) post, Adam noted that 16,357 tokens launched on Pump.fun on August 10, while only 175 made it to Raydium (a decentralized exchange). That means that only about 0.12% of meme coins launched that day on Pump made it to Raydium, where these tokens enjoy greater visibility and can reach new highs. From a trading perspective, there is only a 0.12% chance of making life-changing gains from coins launched on the platform.
Pump.fun Needs To Do Better
Members of the crypto community have continued to clamor for Pump.fun to implement mechanisms that can help curb the countless number of rugs launched on the platform. One is the potential increase in the fee needed to create a token on the meme coin generator. Crypto community members believe that can deter developers whose sole aim is to carry out a pump-and-dump scheme.
However, calls for a higher token creation fee have been ignored. Instead, Pump.fun recently announced that coin creators will receive 0.5 SOL when their coin completes the bonding curve and progresses to Raydium.
It is worth mentioning that the meme coin launchpad has continued to generate millions of dollars in revenue, even at the expense of meme coin traders. Data from Dune Analytics shows that Pump.fun has a total revenue of $90 million. In May, Ex-employee Jarett Dunn mentioned how the platform has “inadvertently hurt people for a long time,” as he drained almost $2 million from Pump.fun and distributed it to random wallet addresses.
Featured image created with Dall.E, chart from Tradingview.com
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