- Pump.fun revenue drops 33%.
- Livestreams featured dangerous content.
- Pump.fun suffers from bad press.
Pump.fun has been on the forefront of Solanaโs memecoin surge. The platform made it easier than ever to launch memecoins, bringing a significant increase in trading activity in the Solana ecosystem. However, it recently became a center of major controversy, which impacted its bottom line.
The latest controversy was due to the platformโs short-lived livestreaming feature. After several memecoin creators engaged in dangerous stunts to pump their memes, the platform shut down the feature. Soon after, its revenues dropped significantly.
Pump.funโs Revenue Drops to Weekly Lows
Pump.funโs revenue dropped significantly on a weekly level. On Wednesday, November 27, Pump.funโs daily revenue was at $3.57 million, down more than 33% from weekly highs. The likely reason for this was the sutting down of the platformโs livestreaming feature.
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In fact, daily revenue reached an all-time high of $5.31 billion on Sunday, November 24. That was just a day before the platform shut down livestreaming due to public backlash. The next day, daily revenue dropped by 33%, hitting 3.76 million.
Livestreams enabled pump.fun creators to engage with their audience and promote meme tokens in real time. However, the feature drew controversy, as many creators engaged in offensive or dangerous activities. For instance, streamers handled weapons and threatened self-harming or harming others to make the tokens go up.
Pump.funโs Effect on the Solana Ecosystem
Since its launch in January this year, Pump fun has had a major impact on the Solana ecosystem. By enabling users to create tokens with minimal technical expertise, it created a memecoin boom on Solana. Soon after, celebrities started launching their own memecoins.
The platform contributed to Solanaโs record volumes, which recently reached all-time highs. Notably, Solanaโs DEX volumes broke $100 million first time in November, surpassing Ethereum. Pump.fun itself generated $230 million in revenue by November.
Still, Pump.funโs rise was always followed by controversy. Critics have called it a โscam factory,โ due to prolific rug pulls and abandoned projects. More recently, Binanceโs founder Changpeng (CZ) Zhao stated that memecoins were getting โa little weirdโ and that the community should focus on real appreciations.
On the Flipside
- Pump.fun faces increasing competition from other platforms, including those on Ethereum, Tron, Base and other chains.
- In November, one trading bot made $6.8 million on Pump.fun memecoins.
Why This Matters
Pump.funโs revenue drop showcases the importance of content moderation on platforms, including those in crypto. Platforms have to manage the content or face reputational risks.
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