PumpSwap's Fee Cut Drives 8.7M Meme Coin Creations on Solana

Decentralized exchanges (DEXs) such as Raydium, Orca, and the newly launched PumpSwap have become central to the meme coin frenzy, driven by their fast transactions, low fees, and ease of access. These platforms have revolutionized the way meme coins are created and traded, particularly on the Solana blockchain, which is known for handling over 65,000 transactions per second with minimal fees.

PumpSwap, the latest DEX from token launchpad Pump.fun, has eliminated the need for an initial fee of 6 SOL before transferring tokens to Raydium for trading. This change allows tokens to be traded immediately within the PumpSwap ecosystem, reducing costs and retaining liquidity. This innovation fosters a stronger environment for meme coin growth and has led to an explosion of new meme coins, with over 8.7 million tokens created on Pump.fun since its launch. Pump.fun accounts for 61% of the tokens launched on Solana, averaging over 621,000 new tokens per month.

In response to PumpSwap's success, Raydium has introduced its own meme coin launchpad, LaunchLab, to compete with Pump.fun. Both PumpSwap and Raydium have adopted an Automated Market Maker (AMM) model similar to Uniswap v4 and Raydium v4, offering low trading fees of 0.25% and eliminating the need for liquidity pool creation fees. This encourages users to create new tokens with minimal costs and start trading instantly.

PumpSwap also promises to share revenue with token creators, further incentivizing new projects and communities. Tools like Phantom Wallet make it easier for users to access DEXs, increasing liquidity and trading volume. With a total trading volume reaching significant heights, DEXs are facilitating meme coin trade and serving as a bridge to integrate them into the broader financial ecosystem.

However, the boom in meme coins on DEXs comes with significant risks. Most meme coins lack intrinsic value and rely entirely on crowd FOMO and viral social media campaigns. When the hype fades, many tokens experience catastrophic crashes. For instance, LIBRA, a Solana-based meme coin, once reached a market cap of hundreds of millions of dollars but nearly collapsed to zero after a massive crash in February 2025. During the same month, Solana’s meme coin trading volume plummeted, indicating a potential downturn in this trend.

Additionally, with such low token creation costs, platforms like Pump.fun have become a haven for scammers. “Rug pulls”—where developers drain liquidity and disappear—are increasingly common, eroding investor trust. Regulatory pressures also pose a major threat, as authorities tighten control over cryptocurrencies, which could lead to severe consequences for DEXs and meme coins.

Despite these risks, DEXs like PumpSwap, Raydium, and Jupiter have been crucial in fueling the meme coin craze. PumpSwap could mark a turning point, helping meme coins on Solana recover after a period of decline. However, it remains a highly volatile space where the bubble could burst at any moment without thorough research and clear strategies. Investors are advised to proceed with caution and conduct their own due diligence before engaging in meme coin trading on DEXs.