The possible closure of Memecoin platform Pump.fun poses a major threat to Solana. Can the ecosystem continue to perform without the hype surrounding memecoins?

In this article you will read:

How big the growth of memecoins is during this bull market
Why they are so problematic and sometimes even illegal
Why authorities are likely to intervene
How this could hit Solana hard

Solana's growth driven by memecoins

Solana is one of the best performers in this bull market. Its share price and other data have only increased in recent months. But much of this success depends on memecoins. These tokens dominate the ecosystem and are often created through the platform Pump.fun. However, this platform is under heavy criticism due to fraud and scandals. A ban on Pump.fun would be a major blow to Solana.

The memecoin hype: big profits and lots of problems

Memecoins have become hugely popular and have reached a total market value of $110 billion. There are stories of investors who became millionaires with one trade. But there is also a dark side: fraud, insider trades and other scams are common. Pump.fun, the main platform on Solana, creates tens of thousands of tokens daily, some of which involve inappropriate content or abuse.

Possible interventions by authorities

With all the criticism, it seems a matter of time before the authorities intervene. Legal experts warning that lawsuits and fines could follow. This would greatly damage Solana's reputation and position among institutional investors.

How dependent is Solana on memecoins?

The numbers don't lie: much of Solana's activity and revenue comes from memecoins. Pump.fun and Raydium, Solana's main decentralized exchange, account for billions of dollars in trading volume. Without these revenue sources, more than half of the activity on Solana could disappear and users would switch to other blockchains.

Solana has weathered severe crises before, such as the collapse of FTX in 2021. Solana developers remain optimistic. They point to technological advances, partnerships with Visa and Mastercard, and other strengths of the ecosystem.

Whether Solana manages to pull itself out of another crisis depends on how well the ecosystem can develop without the reliance on Memecoins. Success will lie in attracting users and building long-term use cases.