Raydium’s native token, RAY, has faced substantial declines amid growing speculation that Pump.fun, a leading Solana(SOL)-based meme coin launchpad, is testing its own Automated Market Maker (AMM).
Neither Pump.fun nor Raydium has officially commented, leaving the market to react to speculation alone.
Over the past day, RAY has seen a 31% drop in value. At the time of writing, the token traded at $2.9. This marked its lowest price since late October 2024.
The decline appears to have been triggered by the discovery of a test version of an AMM under the URL “amm.pump.fun.” An on-chain sleuth, “trenchdiver,” spotted this, and it quickly gained traction across the social media platform X (formerly Twitter).
“Pump.fun is working on their own AMM liquidity pools, which is currently being tested on amm.pump.fun,” the user posted.
The implications of this move are significant. Raydium is a leading AMM and liquidity provider on the Solana blockchain. It has long benefited from its symbiotic relationship with Pump.fun.
The launchpad allows users to create and launch meme coins at a low cost, while Raydium provides liquidity infrastructure. Once these tokens gain traction, they enter Raydium’s trading pools, driving volume and generating swap fees. Currently, Raydium charges a 0.25% swap fee, profiting from the trading activity Pump.fun brings in.
However, Pump.fun appears to be shifting its strategy—potentially moving trading volume and fees away from Raydium to its own liquidity pools.
This would allow the platform to collect more fees on Solana or introduce new reward mechanisms for token holders, posing a direct challenge to Raydium’s dominance in the decentralized exchange (DEX) ecosystem.
“This move could really hurt Raydium’s business,” an analyst said.
Meanwhile, the first token integrated into its experimental liquidity pool is reported to be the CRACK meme coin. If these pools prove successful, Pump.fun could reduce its reliance on Raydium entirely, breaking the partnership that has historically fueled Raydium’s growth.
Therefore, Raydium may be forced to adjust its strategy or risk losing a key revenue source. The battle for Solana’s liquidity is heating up, and the market is already reacting.
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