Cryptocurrency news

The "income" of the meme token factory" Pump.fun has collapsed by 30%

Forklog / 27.06.2024 / 09:17
The "income" of the meme token factory" Pump.fun has collapsed by 30%

The daily amount of commissions on the platform for launching Pump meme tokens.Solana-based fun has decreased by 30%, The Block noted.

During the working week from June 10 to June 14, the daily average income of the site was approximately $870,000. During the current five-day period, the indicator fell to $605,000.

Data: The Block.

Experts of the publication linked the reduction in Pump's income.fun with unfavorable market conditions in general and SOL price dynamics. On June 24, bitcoin again failed the $62,000 level, and the quotes of the native Solana token have decreased by more than 18% over the past 30 days (CoinGecko).

All these factors reduce investors' appetite for risk, which is especially important for sites like Pump.fun. Memecoins launched using the service are extremely speculative in nature, attracting users with the opportunity to make a quick profit, analysts say. However, traders are just as quick to exit positions in assets when market conditions change.

The drop in Pump revenues.fun may indicate that the platform and the volume of tokens being launched have reached oversaturation levels, experts admitted. Given the huge number of new coins being deployed on the site, it may not be able to cope with this flow, they added.

The last two months of Pump.fun generated an average of 35% of Solana's total commission income. The figure does not include fees from third-party DEX and other trading services from transactions with tokens running on the platform.

Given the speculative nature of assets, such dependence carries risks for the blockchain. User activity and revenue from network fees may drop sharply if the hype around meme coins subsides, experts stressed.

"A well-balanced blockchain platform perfectly supports various applications and protocols, ensuring that it will not be overly dependent on any single source of activity or income," they concluded.

Recall that the DEX Screener cryptocurrency data service launched on Solana competing with Pump.fun platform for launching meme coins called Moonshot.

Source
Recently News

© Token Radar 2024. All Rights Reserved.
IMPORTANT DISCLAIMER: All content provided herein our website, hyperlinked sites, associated applications, forums, blogs, social media accounts and other platforms (“Site”) is for your general information only, procured from third party sources. We make no warranties of any kind in relation to our content, including but not limited to accuracy and updatedness. No part of the content that we provide constitutes financial advice, legal advice or any other form of advice meant for your specific reliance for any purpose. Any use or reliance on our content is solely at your own risk and discretion. You should conduct your own research, review, analyse and verify our content before relying on them. Trading is a highly risky activity that can lead to major losses, please therefore consult your financial advisor before making any decision. No content on our Site is meant to be a solicitation or offer.