Solana DEX Battle Ignites: Pump.fun’s $2.5B Surge Challenges Raydium, Orca Despite Lawsuit

Solana’s decentralized exchange (DEX) market is experiencing a dramatic shake-up as Raydium, Orca, and the upstart Pump.fun battle for supremacy.

With Solana’s growing popularity as the blockchain of choice for meme coins and fast, low-cost transactions, the competition among its top DEX platforms is intensifying.

According to data from Blockworks, Raydium remains the leader in weekly volume, but both Orca and Pump.fun are rapidly gaining ground.

The origins of this rivalry date back to March, when Pump.fun severed ties with Raydium to launch its own decentralized exchange (DEX), PumpSwap.

Until then, Raydium was the default liquidity hub for tokens graduating from Pump.fun. In response, Raydium launched its own meme coin infrastructure, LaunchLab.

Now, as PumpSwap sees soaring volumes and LaunchLab boasts thousands of new token creations, both platforms are racing for users and narrative dominance.

A Feature-Packed Response Facing Growing Pains

When Raydium announced LaunchLab on April 16, it marked a bold pivot from being just a backend AMM to becoming a full-fledged meme coin launchpad.

Only weeks earlier, Pump.fun had disrupted the status quo by launching PumpSwap, effectively removing Raydium from the meme coin pipeline.

LaunchLab was designed with flexibility in mind, offering two token creation pathways.

The “JustSendIt” mode allows creators to launch a token with zero code, initiating a bonding curve that requires raising 85 SOL before liquidity is automatically transferred into a Raydium pool.

The more customizable mode lets developers define everything from tokenomics to vesting schedules, offering advanced features for more sophisticated projects.

Raydium also added strong creator and community incentives. A 1% trading fee is split to benefit $RAY buybacks, operations, and a community pool.

Creators receive 10% of trading fees, and a referral program gives 10 basis points of swap volume in SOL to those who onboard new users.

Despite this robust structure, LaunchLab’s real-world performance has been mixed. In less than a week, the platform facilitated the creation of over 3,800 tokens.

Yet only 44 of them have successfully transitioned to active trading on Raydium’s AMM, a graduation rate of just 1.12%.

Nevertheless, LaunchLab helped spark a short-term rally for Solana. SOL surged nearly 6% after the platform’s debut, breaking technical resistance.

From Meme Coin Factory to DEX Powerhouse

PumpSwap, launched on March 21, removed the need for tokens to migrate to Raydium, eliminating the 6 SOL fee and simplifying the process. The results were immediate and explosive.

Within a week, PumpSwap processed over $2.5 billion in trades and recorded $417.8 million in daily volume at its peak. Over 264,000 wallets were active during this frenzy, showing the sheer scale of adoption.

PumpSwap’s fee model is equally competitive, with a 0.25% per-trade fee, of which 0.20% is allocated to liquidity providers and the protocol retains 0.05%.

Plans for a creator revenue-sharing scheme are already underway. Its model mirrors that of Raydium V4 and Uniswap V2, allowing for seamless, permissionless liquidity pool creation with minimal overhead.

Yet not everything is rosy. Pump.fun is currently battling legal troubles. A class-action lawsuit filed by Burwick Law alleges the sale of unregistered securities, with a particular focus on the PNUT token.

The lawsuit accuses the platform of allowing Ponzi-like schemes without providing adequate investor protections.

Though the outcome is still unclear, this cloud looms over PumpSwap’s otherwise stellar debut.

As Raydium and Pump.fun fight for liquidity and market share, the biggest winner might be Solana itself.

With Orca now also entering the fray, increased trading activity, lively meme coin creation, and enhanced user engagement are pushing the blockchain to new heights.

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