Article author: Token Dispatch, Prathik Desai Article compilation: Block unicorn

Solana's Meme currency ecosystem is experiencing an inappropriate infighting, and the two giants - Pump.fun and Raydium - have declared war on each other.

In just 48 hours, we saw Raydium announce LaunchLab, its own token launch platform, followed by Pump.fun’s launch of PumpSwap, a native decentralized exchange (DEX) that completely excludes Raydium from its ecosystem.

This power struggle is particularly fascinating because of its timing when the once prosperous Meme currency market showed obvious signs of weakness. Since its January peak, Solana network revenue has plummeted 95%, while daily DEX transaction volume has dropped by more than 93%.

In today's article, we dive into this high-stakes showdown, exploring how the partnership that once pushed Solana to new heights turned into a battle of survival and what it means for the future of Solana's decentralized transactions.

The breakdown of the partnership

Pump.fun and Raydium have worked perfectly together since the beginning of 2024. Pump.fun democratizes token creation, allowing anyone to issue Meme coins at a price of cents through their bond curve system.

When these tokens reach the magical $69,000 market cap threshold, they "graduate" to Raydium (Solana's premiere DEX), where they can be traded freely on a wider market.

This is a perfect arrangement that is very beneficial to both parties.

Pump.fun focuses on what it does best: attracting millions of new users and facilitating token creation

Raydium can capture a large amount of transaction volume and fees without building a token startup platform.

The story behind the numbers

According to data from Blockworks Research, Pump.fun tokens account for 41% of Raydium's exchange fee revenue in the past month. Some people even raised this number to 43.5%.

What is the bet? Revenue flows worth tens of millions of dollars per month and control of the future of Solana Meme coins.

Raydium also reaped returns as Pump.fun facilitated over 8.65 million token launches and attracted 15 million addresses—a dealership fee of over 80 million USD from Meme coin activity alone.

But there are friction points in this system. Each token’s “graduation” requires:

6 SOL’s migration fee (about $800 at the current price)

The time-consuming migration process can take hours

Complexity confuses new users and disrupts the token’s momentum

What about the result? Of the tokens created on Pump.fun, only a small percentage graduated to Raydium.

These pain points create opportunities for destruction—which both sides are now actively taking advantage of.

The current conflict

In the dramatic 48 hours, the long-simmering tensions completely changed the Solana ecosystem.

On March 18, Raydium announced the launch of LaunchLab, its own license-free token launch platform designed to compete directly with Pump.fun. This is not aimless; it was previously reported that Pump.fun is considering launching its native DEX.

LaunchLab introduces several features to improve the Pump.fun model.

The message is clear: Raydium is no longer content to just charge transaction fees—it also wants Pump.fun's market share.

Pump.fun responded quickly. On March 20, it launched PumpSwap – a native DEX that effectively ended its dependency on Raydium.

The market immediately recognized the importance of this move. Within five minutes after PumpSwap's announcement, Raydium's RAY token plummeted 7.6%, with the decline widening to nearly 9% on the day.

In February, when Pump.fun was first discovered to test AMM functionality, there were only rumors outside the world that it has now broken out into a full-scale DeFi war. Both platforms are competing for the same creators, the same traders, and most importantly, the same fee income.

Meme Coin Market Background

For the Solana Meme Coin ecosystem, this power struggle was not the time. The two competitors may be fighting for a rapidly shrinking cake.

The Meme currency market on Solana has experienced a dramatic reversal since its fanatical peak in January. Consider these alarming statistics:

Solana's online revenue has plummeted 93% since January

Trading fees have plummeted 83% in the past month alone

Even token graduations from Pump.fun to Raydium have dried up.

"There are fewer and fewer tokens reaching the threshold. During peak hours, the average number of active wallets in 30 minutes is about 6-7,000. Now it's down 30-40%", Bam, founder and developerbino is indicated on X.

The weekly graduation rate continues to decline—from a high of 1.67% in November to 0.63% now.

What caused this sharp slowdown? Several factors work together.

Remember those high-profile Meme coin scams?

Investment firm Bernstein has predicted that market liquidity will shift from "useless Meme coins" to DeFi, gaming and NFT.

Interestingly, is whether Pump.fun and Raydium are fighting for the last few passengers on a sinking ship—or whether their innovations can rekindle interest in Meme coins.

Who has the advantage?

As this DEX war unfolds, both competitors have brought important but different strategic advantages on the battlefield.

This creates interesting competitive dynamics.

Raydium has technical infrastructure and liquidity depth, but needs to attract creators. Pump.fun has creators and brands, but needs to build liquidity in its new exchange.

The key battlefield may be the inspiration of creators. PumpSwap's upcoming "creator revenue sharing" feature may fundamentally change the landscape of Meme coins.

Arif Kazi, head of business development at Sonic SVM, posted on X: "Early, Meme coin creators had to sell for profit. Now they earn from each transaction, which may drive long-term projects rather than rapid hype."

This innovation solves a core problem in the Meme coin ecosystem - creators' motivation to sell. By tying the creator's success with sustainable trading volume rather than initial priceGrahlift hooks, PumpSwap may foster more durable projects.

However, DeFi history shows that these wars can quickly become destructive. If two platforms compete on the bottom of the charge, or attract liquidity through aggressive incentive plans, they may create unsustainable economic models that harm both parties.

Impact on Solana

The conflict between Pump.fun and Raydium is more than a simple business dispute—it represents a critical moment in the evolution of the Solana ecosystem.

Although the Meme coin craze has subsided, its role in honing Solana infrastructure is still a highlight.

Messari research analyst Matthew Nay pointed out as an example of the launch of Trump tokens: "Solana can handle nearly $40 billion in a day without crashing. This is equivalent to 10% of the Nasdaq's trading volume during the 24-hour regular trading session."

This massive stress test accelerates Solana's maturity.

If the Meme coin fanaticism fades, where will Solana's DeFi ecosystem focus next? Some potential paths are emerging.

DeFi Revival: Former Ethereum extremist and current Solana advocate Kain Warwick believes that traditional DeFi applications may eventually cross the gap and enter mainstream adoption. "DeFi is obviously a direction. Decentralized lending protocols like Aave may be widely adopted."

DePIN: DePIN: Decentralized Physical Infrastructure): Nay highlights projects like Helium and HiveMapper, calling them "excellent leaders" and bringing real-world practicality to blockchain.

Game: With the infrastructure improvements brought by Meme currency traffic, Solana is now more capable of supporting gaming applications.

Evolved Meme Coin: Although the classic animal-themed Meme Coin is fading, Nay sees the potential of a new generation of Meme coins with practical utility. For example, creator tokens that support new influencers allow investors to share future YouTube revenues—not just “a random picture of animals.”

However, Solana's current economic situation poses a challenge to the growth of DeFi. Tushar Jain of Multicoin Capital explained that high inflation and pledge yields “set high barriers for people to participate in DeFi.” When users can get risk-free returns through staking, their motivation to use the DeFi protocol is reduced unless the DeFi protocol provides a significantly higher rate of return.

Our perspective

As the dust of this week's dramatic announcements settled, we are witnessing a business competition that could reshape Solana's entire DeFi landscape.

In the short term, both platforms face key execution challenges. PumpSwap must establish sufficient liquidity without Raydium’s existing liquidity pool and implement its committed creator revenue sharing model. Meanwhile, LaunchLab needs to attract creators to leave Pump.fun’s ecosystem and take advantage of Raydium’s existing liquidity benefits.

In addition to tactical operations, this conflict represents the natural evolution of a mature ecosystem. The relationship between Pump.fun and Raydium thrives during the speculative phase of cryptocurrencies, but their interests divergence becomes irreconcilable as the market shrinks.

As the battle breaks out, the Meme currency market is facing exhaustion, the number of token graduations plummeted and the trading volume collapsed. While they are competing for control of the Meme currency market, it is interesting to see whether this market is still important enough to be fought for.

The most valuable outcome of this conflict is probably how it accelerates Solana's evolution beyond Meme coins, and how competition drives innovation. For example, PumpSwap's creator revenue sharing model may change token economics by pegging creators' success to sustainable trading rather than pulling up the sell-off cycle.

This moment echoes a similar shift we have seen in the cryptocurrency world—from ICO to DeFiSummer, to the NFT boom. Each wave of speculation will eventually give way to more sustainable use cases. Perhaps the war between Pump.fun and Raydium marks the end of the era of pure speculation, and the beginning of a development phase with practicality at Solana.

For users and creators, this competition should lead to better tools, lower fees, and more consistent incentives—assuming that platforms don’t destroy each other through unsustainable economic models. One uncertain factor is whether Pump.fun’s tokens may dramatically change the balance of power through strategic airdrops and token economics incentives.

Ultimately, this conflict represents a process of creative destruction. Despite the increasing tensions and the price of tokens, the entire ecosystem will benefit from the innovation driven by this competition.