The controversy surrounding the LIBRA token has had significant impacts on the Solana-based token launchpad Pump.fun. According to data from a Dune Analytics dashboard, the number of new users onboarded by Pump.fun dropped by 16.4% between February 7 and February 13, falling from 719,524 to 601,516. This decrease marked the first time since late November that the daily average of new users fell below 100,000 within a week. Additionally, the number of tokens deployed weekly by Pump.fun decreased by 26.3%, from 344,607 to 253,955, following the LIBRA incident. Despite the decline, Pump.fun has still deployed close to 8 million tokens in 13 months as of February 21.
In addition to the decrease in new users and tokens deployed, Pump.fun also experienced a drop in fees collected during the same period. The launchpad collected 124,623 SOL in fees from February 7 to 13, but this figure fell by nearly 32% to 85,196 SOL in the following week. This was the first time since late December that the daily average of fees collected fell below 15,000 SOL within a week. The decrease in fees can be attributed to the lower number of tokens deployed by Pump.fun during this time frame.
The controversy surrounding the memecoin LIBRA, which saw Argentine President Javier Milei endorse the token on February 14, had a cooling effect on the memecoin market on Solana. Despite the initial price surge and market cap reaching $4.5 billion, the token crashed 95% over the weekend following Milei’s endorsement. A report by Nansen revealed that two wallets profited over $10 million by buying the token immediately after Milei’s endorsement and selling it at its peak price of $4.55. This raised concerns about insider trading activity in memecoin markets and sparked debates about the impact of memecoins on Solana’s credibility.
As a result of the debates and investor unease surrounding memecoins, the memecoin sector on Solana has fallen by 13.4% since February 14, making it the third-largest drawdown in altcoin sectors during this period according to Artemis’ data. The overall market sentiments and concerns raised by the LIBRA incident have played a significant role in Pump.fun’s decline in new users, tokens deployed, and fees collected over the past week. There is ongoing discussion about the regulation and oversight of memecoins to prevent incidents like this in the future and ensure the integrity of the Solana ecosystem.
