Pump.fun mints money, critics unhappy

Solana’s Pump.fun has generated over $100 million in revenue since launching in January, but users are unsure whether this is a good thing for cryptocurrencies and decentralized finance.

The platform, introduced in January, gained popularity fast and doubled its income from $50 million in July to $100 million in September.

For a $2 fee and a 1% commission on transactions, users can create and list meme currency on the Raydium decentralized market with Pump.fun. It has grown to be a prominent participant in the decentralized exchange market for Solana, making up a sizeable amount of the overall volume of transactions.

Solana emerged as the preferred memecoin chain in DeFi. following the service’s launch in early 2024, Developers once used the platform to generate over 500,000 meme coins in a single month. Some praise pump. fun’s novel approach to token manufacturing as a breakthrough.

The launchpad made it easier than ever to create tokens with a few clicks, which led to oversaturation in the Solana ecosystem. According to a crypto.news study, less than 1% of Pump.fun wallets saw profits of $1,000 or more.

Many have questioned whether this is better for DeFi and the cryptocurrency space despite Pump.fun’s quick ascent to $100 million in sales. Opponents assert that it encourages fraud because numerous projects have allegedly used “rug pull” fraud.

A user contended that the platform encouraged celebrity money grabs that were at odds with the principles of cryptocurrency. Some well-known people, including Iggy Azalea and Andrew Tate, introduced Pump.fun meme coins. The majority of tokens have plummeted significantly below their peak prices.

The Solana-based platform is still under regulatory review,  the U.S. Securities and Exchange Commission maintains that SOL and its ecosystem breach federal securities laws.

This mistrust has kept rival blockchains like TRON from implementing comparable methods; TRON’s Sunpump has emerged as a rival. About 70,000 meme tokens have already been released by Sunpump, and the company has made almost $4 million in sales.