“Solana Experiences Issues with Memecoins on Pump.fun”

Due to the current rapid rise of memecoins, this has also caused unexpected problems for Solana (SOL). Large amounts of SOL tokens are stuck in Pump.fun bonding curve contracts. It is estimated that more than 98% of all tokens at this stage are held by Pump.fun, along with the associated SOL deposits.

Pump.fun serves as an unintended tool to lock SOL. Only a small percentage of the meme tokens reach the trading platform Raydium, where all raised liquidity is transferred to the DEX. However, many meme tokens get stranded in the bonding curve phase, preventing them from reaching the required market volume to break through. Some projects end up as rug pulls, with the SOL ending up in the hands of the developers. Other tokens remain stuck and are hardly traded.

As of November 29, a total of 4,022,404 new tokens have been created on Pump.fun, with tens of thousands of additional launches daily. For each token, a quantity of SOL is deposited until the project reaches the required valuation to be added to Raydium. Pump.fun is responsible for 70% of all assets created on Solana, while the remaining 30% is generated by other projects.

In addition, estimates show that stuck bonding curves on Pump.fun contain an average of $3,471 in SOL per token. Now that live streams have been disabled due to unregulated chaos, Pump.fun tokens are having more difficulty generating liquidity through marketing.

The SOL trapped in bonding curve tokens comes from creators, bots, and early traders trying to quickly acquire the assets. A significant portion of the tokens are still traded within the bonding curve phase, but with minimal liquidity. According to an estimate, more than 58 million SOL is locked up, while an alternative calculation comes to a much lower figure of 162,789 SOL.

Impact of memecoins on Solana

While many tokens attract SOL, the most successful projects quickly leave Pump.fun. The long list of less valuable tokens means that a lot of SOL is stuck in inactive or unknown projects. As a result, Pump.fun serves as a trap for SOL, with these tokens remaining outside other parts of the Solana ecosystem.

However, this also has advantages: SOL becomes deflationary and more valuable as there is less pressure to sell for stablecoins. Despite an inflation ratio of nearly 5% due to validator rewards, the SOL stuck in DeFi and meme tokens helps to compensate for this.

Raydium reaches peak value

Only a handful of tokens make it to the Raydium DEX, but those that do contribute to a record in locked value. The liquidity pools on Raydium now have over $2.3 billion in value locked, alongside a very active daily trading turnover.

The total locked value on Solana is more than $9 billion, spread across DEXs and lending protocols. Although Pump.fun is still far from that valuation, it has shown significant SOL turnover within the meme token market.

With strong demand, SOL remains near its peak value, trading at $240.55. Bot activity on Solana has increased significantly over the past two months, accounting for 87% of all bot traffic on November 29, compared to 50% in early October. This confirms Solana’s position as one of the most dynamic blockchain networks in the crypto industry.