Pump.fun, the popular Solana-based memecoin launchpad, is reportedly testing its automated market maker which could replace Raydium as the default decentralized exchange for graduated tokens.
The development was first spotted by X news aggregator platform Aggr News, which took notice of amm.pump.fun, a new liquidity pool under internal testing. If implemented, Pump.fun’s in-house AMM would allow the platform to capture more fees, potentially impacting trading fees on Raydium (RAY).
https://t.co/wohP4puuSl TESTING IN-HOUSE AMM, POTENTIALLY REPLACING RAYDIUM AS THIRD PARTY PROVIDER: WEBSITE pic.twitter.com/VLavRsRHFQ
— Aggr News (@AggrNews) February 24, 2025
The shift comes as memecoins continue to command huge volumes in the DEX market. Pump.fun has already generated over $500 million in total swap fees, according to DeFiLlama. Currently, about 1.4% of tokens launched on the platform migrate to Raydium, meaning an in-house AMM could help keep more liquidity within the ecosystem.
The X community is speculating that this development could also pave the way for additional features like memecoin perpetuals and lending. Raydium could see a 30-50% drop in trading volume if Pump.fun moves forward with the transition. This would greatly impact Raydium’s market position. Raydium’s token, RAY, is already down 20% in the last 24 hours in reaction to the news, according to CoinGecko.
Beyond its liquidity shift, Pump.fun has been in the news for stopping a hacker connected to the recent $1.4 billion Bybit hack from laundering funds on the platform. Pump.fun blocked the attacker’s ability to transfer assets via Pump.fun’s infrastructure and stopped them from laundering stolen money through a memecoin launch.
Through a coin called “QinShihuang (500000),” the hacker had already pushed over $26 million in trade volume before being banned. According to blockchain data, the attacker moved 60 SOL to a different wallet before launching the token on Pump.fun, perhaps to mix and hide the stolen assets.
