Pump.fun Overhauls Creator Fees as Token Launches Hit Highest Daily Count Since September

Pump.fun, the Solana-based memecoin launchpad, has rolled out changes to its creator fee system after concluding that existing incentives were misaligned with the platform's long-term market health according to The Block. The updates are part of Project Ascend, a broader initiative aimed at rebalancing the platform's ecosystem to support both creators and traders.

The overhaul comes as token launches on Pump.fun hit their highest daily levels since September. According to The Block's data, nearly 30,000 tokens launched on the platform on Tuesday, signaling renewed activity. The surge coincides with the introduction of creator fee sharing, a new feature that allows teams to distribute fees across up to 10 wallets and assign specific percentages post-launch.

Pump.fun CEO Alon Cohen returned to X after a 65-day silence to announce the changes. In a detailed post, Cohen stated that the previous fee model had skewed incentives toward low-risk coin creation, neglecting the role of traders in driving platform activity as reported by CryptoBriefing. The new system aims to recenter the platform around trading activity, which Cohen described as the 'lifeblood' of Pump.fun.

Why Did This Happen?

The Dynamic Fees V1 model, introduced in September as part of Project Ascend, succeeded in attracting new builders and increasing on-chain activity according to The Block. However, Cohen noted that it failed to significantly influence the behavior of average memecoin deployers, who often focused on low-risk creation over high-risk trading.

The updated model introduces a tiered fee structure based on a token's market capitalization. As tokens grow larger, creator fees decrease, aiming to balance sustainability for projects with long-term trader participation according to The Block. This approach is intended to encourage more meaningful engagement from traders, rather than just creators.

How Did Markets Respond?

Market reactions were swift. Shortly after the announcement, Pump.fun's native token, PUMP, rose by over 10%. The increase reflected optimism that the new fee structure could lead to more sustainable and balanced growth for the platform.

Additionally, the surge in token launches suggests that the updated system is already gaining traction. With the new features allowing more flexibility in fee distribution, creators are likely to see increased participation and potentially higher returns according to CoinMarketCap.

What Are Analysts Watching Next?

Analysts are now closely watching whether the new model will lead to sustained improvements in platform activity and creator earnings. The first 24 hours under the updated system saw $2 million distributed to creators, a significant jump from the previous day's $198,000 according to CoinMarketCap. This suggests that the new structure is already having a measurable impact.

Further, the CEO has hinted that future updates will take a 'market-based approach,' allowing traders to decide whether a token's narrative warrants creator fees according to The Block. This shift could further rebalance the platform's dynamics by giving more power to traders rather than deployers.

The next phase of Pump.fun's strategy will be critical. If the platform can maintain this momentum while ensuring long-term sustainability, it could become a more attractive option for both creators and traders in the rapidly evolving memecoin space.

Pump.fun's ability to maintain this balance will depend on several factors, including continued user adoption and the effectiveness of its new fee-sharing mechanism. Analysts will be watching closely to see if this model can be replicated in other platforms and how it affects broader market behavior.