Once a leading platform in the meme coin craze, Pump.fun is now banned in the UK. Following the decision of the financial regulator, the platform experienced a significant decline in activity across the board. The creation of new tokens has decreased by 50%, and the number of daily active users plummeted by 38%, dropping from 261,000 to 161,000. What does this mean for the meme coin industry? Experts weigh in…
The Rise and Fall of Pump.fun
Pump.fun, a platform for creating meme tokens, set a record on November 20 with the creation of 69,000 new tokens in a single day. However, this number has now dropped to 33,000. The platform’s transaction fees, revenues, and trading volume have also seen sharp declines.
In 2024, Pump.fun gained attention for leveraging the Solana network, driving user activity to its peak with a wave of meme coins. Throughout the year, it generated millions of dollars in profits. Yet, recent controversies suggest the platform’s decline may be inevitable.
Pump.fun allows anyone to create meme coins without any control mechanisms, leading to numerous issues, including racist content, harmful jokes, and fake suicide videos that have tarnished the platform’s reputation.
On November 25, the disabling of the platform’s live-streaming feature resulted in a 33% revenue drop. Subsequently, the UK’s Financial Conduct Authority (FCA) announced that the platform could no longer operate legally in the country and blocked access.
What Do Experts Say?
The Cambridge Centre for Alternative Finance published a report analyzing the decentralization claims of DeFi protocols. The study revealed that governance power in the top 10 DAOs is heavily concentrated among a few major players.
Christopher Jack, who led the research, described the findings as “shocking.” He stated:
“When speaking to industry participants, they often mentioned that governance is controlled by a handful of major players. Our analysis confirms this.”
Using the Gini coefficient, the report found that the power concentration in DAOs is comparable to income inequality in some of the world’s most unequal nations.
Meanwhile, Robert Leshner, founder of the Ethereum-based DeFi protocol Compound Finance, is now preparing to support entrepreneurs developing DeFi applications on XRP Ledger. Leshner noted that Ripple’s vast user base holds significant potential, despite the current lack of on-chain applications.
However, the absence of general-purpose smart contract support on XRP Ledger poses challenges for developers. This situation is expected to change with Ripple’s launch of an EVM sidechain. Leshner emphasized their desire to act ahead of this milestone, stating:
“We believe Ripple will be a turning point in DeFi’s evolution. We’re eager to meet teams already working in this space.”
