If you are conversant with the cryptocurrency world, then you should know that meme coins are the latest trendy assets. Platforms like Pump.fun were created to make it easy to create, trade, and engage with meme coins. But how exactly does it work? Read this content till the end to find out. We’ll discuss the mechanics and features of Pump.fun. Also, you’ll learn how to create your own meme coin!
KEY TAKEAWAYS:
- Pump.fun is a meme coin generator that is hosted in the Solana blockchain.
- Some of its features include easy meme coin generation, low fees, and a bonding curve model.
- You will need a Solana-compatible wallet to trade and create meme coins on Pump.fun
- Successful meme coins launched on Pump.fun include BaoBaoSol, Shark Cat (SC), and Hobbes.
What Is Pump.fun
Pump.fun is a meme coin generator that is hosted on the Solana blockchain. It is a user-friendly way for crypto lovers to trade and create their own tokens. This platform was launched in 2024. However, it has gained massive traction in the crypto world because of its functionality and expanding user base.
Pump.fun initially supported the Solana network. Now, it has grown to include Base and Blast, which are Ethereum Layer 2 networks. Because of how it democratized token creation to ensure inclusivity, it generated between $200,000 – 400,000 in trading revenue. That said, here are the major features that make Pump.fun stand out:
- Easy meme coin creation: With little or no technical knowledge, you can create meme coins on Pump.fun. The basic things you will have to provide include a name, image, and ticker symbol for your token. Also, you’ll pay a fee of 0.02 SOL to make your token available for trading.
- Bonding curve model: Pump.fun uses a dynamic bonding curve model to adjust the price of a token based on supply and demand. As more people buy a particular token, its price rises. As they sell it, there will be a decrease in value.
- Multiple blockchain support: While it primarily operates on the Soland network, Pump.fun supports other platforms like Base and Blast. This gives users flexibility on where to launch and trade their tokens. Moreover, they can leverage the unique features of these different blockchains.
- Low fees: Pump.fun takes advantage of Solana’s low transaction fees to make it easier for people to mint and trade their meme coins. Its standard charge is 0.02 SOL (around $3) to launch a token. Also, the platform is entitled to a 1% fee on every transaction done on it.
- Protection against market manipulation: Every token created on Pump.fun undergoes a fair launching process to prevent market manipulation. For example, it ensures a healthy token ecosystem by burning a portion of its liquidity once it hits a certain market cap. Additionally, the platform has features that protect traders from scams like rug pulls.
How Pump.fun’s Bonding Curve Mechanism Works
As stated earlier, the bonding curve model is how Pump.fun regulates a meme coin’s price. The process begins when you create a token. At this initial stage, your token received a supply of 800 million meme coins.
The prices increase as they sell out, with early buyers having the opportunity to earn from buying it cheap. Immediately your assets hit a $69,000 in market cap, its liquidity ($12,000 worth of the meme coin) is added to a decentralized exchange called Raydium. Here, $12,000 worth of the token is also burned to ensure market stability. If the meme coins go viral, they can get listed on DEXs and, eventually, CEXs.
How To Trade Meme Coins on Pump.fun?
Trading meme coins that have been created by other users on Pump.fun is easy because of its intuitive user interface. Let’s run through how it is done.
- Connect your wallet: sign up on Pump.fun and connect your Solana-compatible wallet to your profile. Some good examples included Metamask, Phantom, and Solflare.
- Browse the marketplace: Look through the tokens listed on the platform to check details like price, trading volume, and bonding curve status.
- Make your trade: Select the meme coin you would like to either buy or sell, then confirm your transactions. Timing is essential when doing this because prices are volatile.
How To Create Meme Coins on Pump.fun?
Launching your meme coins on Pump.fun involves a blend of creativity and simplicity.
- Connect your wallet, as explained earlier.
- Design your meme coin: You will need a token name, description, ticker symbol, and image. Remember that you will be charged a fee of 0.02L to deploy your memecoin.
- Sell it: You can sell your token at any time. The price will be determined by the current demand.
Top Meme Coins Launched on Pump.fun
Pump.fun has served as the driver behind the success of many memecoins in the crypto market today. Let’s take a look at some notable examples.
- BaoBaoSol: This was the first token to get significant recognition by the broader market. BaoBaoSol’s successful launch on Raydium was a major milestone that proved Pump.fun’s potential to support meaningful projects.
- Shark Cat (SC): Shark Cat (SC) was so popular on this platform that it reached a market cap of $100 million in a short time. Its value further increased because of its dedicated community and the constant social media promotions.
- Hobbes: Just like Shark Cat (SC), this meme coin grew massively because of its community and social media engagement. A fact that became more evident when it hit a market capitalization of $35 million.
Conclusion
Pump.fun is an easy way to join the meme coin train by either creating or trading these tokens. However, like every crypto investment, it comes with its risk of high volatility. By understanding how this platform works, you can use it cautiously to get the best out of it.