Pump.fun rakes in millions as 81% of memecoins plunge 90%

Dominant Solana Platform Keeps Profiting

Pump.fun, a leading launchpad on Solana, remains a major money‑maker through fees on memecoin transactions. Despite many established tokens still failing to rebound after steep losses, the platform pulled in roughly $18.6 million in protocol revenue from Oct. 1‑7, according to DefiLlama data.

Talos analysis found that 81% of a set of 151 memecoins lost at least 90% of their all‑time highs. These steep drops rarely saw significant recoveries, highlighting a structural issue: Pump.fun’s trades can profit the platform, support buybacks of its native token PUMP, or reward certain users, yet offer little benefit to holders of failing tokens.

Massive Failures in the Memecoin Market

Talos selected 150 coins for survival analysis and 151 for return comparison, each with a price on at least one centralized exchange. This selection initially included only relatively successful coins, so the real failure rate among the many launchpad tokens that never listed may be higher.

Among the stronger tokens, declines were extreme. The median token hit its peak only 17 days after trading began on exchanges. Talos defined „collapse” as a 95% drop from the subsequent peak and estimated the average interval between peak and collapse at about 370 days. Very few tokens that collapsed ever returned to earlier levels; of the 151 coins examined, only five stayed above the first‑day price.

Active Addresses and Market Attention

In its specific analysis of major Solana memecoins, Talos noted that the number of active addresses holding more than $1 fell to a maximum of 7% of historical levels. This suggests traders quickly shift to new opportunities rather than repairing existing positions. Roughly two‑thirds of Solana memecoins had not experienced a second significant wave after the initial surge.

This creates a very different economic exposure for individual traders compared to Pump.fun. The platform’s revenue depends on trades it facilitates, not on any token’s recovery. A trader selling a declining coin and buying another creates a new taxable trade. New launches, token rotations, and speculative waves can sustain platform revenue even while early buyers endure large losses.

Fee Structure and Revenue Distribution

DefiLlama reports that traders paid about $52.5 million in fees over the seven days to Oct. 7, with roughly $18.64 million redirected to the protocol. Over 30 days, fees totaled about $184.5 million, and protocol revenue reached approximately $60.7 million.

Pump.fun’s fee structure allocates portions of trading revenue to the protocol, creators, and other liquidity‑connected parties. Its native token PUMP gains from buyback and burn mechanisms, giving the asset exposure to platform activity.

DefiLlama recorded about $8.45 million in burned tokens over seven days and $27.29 million over 30 days. Pump allocated part of its revenue to buy and burn PUMP tokens for a year starting in April. However, this system does not directly support investors holding tokens other than PUMP. Those investors rely on demand recovery, sufficient liquidity to sell, and large enough distributions to offset losses.

Pump.fun Claims User Rewards

Pump.fun says it distributes part of its economy to users. Co‑founder Alon Cohen stated that over 140,000 users received about $4.46 million in a recent 24‑hour period, including $730,000 in holder rewards, $330,000 for promoters, and $3.4 million in creator fees.

„Over time, Pump.fun will far surpass social media in payments and rewards to users,” Cohen said. These payments support the platform’s view that transaction economics are increasingly distributed rather than retained solely at the protocol level. Each reward category favors a different participant type: creator fees target developers, callout rewards go to eligible promoters, and holder rewards apply only to specific tokens, not automatically to every holder of a Pump‑launched asset.

PUMP Token Holders Face a Separate Equation

This distinction is crucial when comparing token losses to received rewards. A holder may receive distributions yet still lose if the token’s value falls faster than the payout. Likewise, a creator can earn significant fees while buyers near the token’s peak suffer sharp declines.

PUMP holders confront a distinct challenge. (The original text ends abruptly; no further details are provided.)