Raydium, Solana's largest decentralized exchange, plans to launch LaunchLab, a memecoin launchpad designed to compete with Pump.fun. This move is prompted by the anticipated split due to Pump.fun's plans to develop its own AMM.
Why Raydium is Launching a Pump.fun Competitor
Raydium's relationship with Pump.fun has been mutually beneficial but fragile. Pump.fun allowed tokens reaching a certain market cap to move into Raydium's pools, providing liquidity and revenue. However, Pump.fun's new AMM threatens to sever this link. Raydium's response, LaunchLab, aims to retain developers and liquidity with its flexible and decentralized offerings.
Pump.fun's AMM Move Sparked the Conflict
Pump.fun quickly became a go-to memecoin platform on Solana. However, rumors of developing their own AMM triggered market turbulence. When the plans were leaked in February, Raydium's token value plummeted, as investors feared a loss of revenue. Raydium had maintained its launchpad plans in secret to avoid competition but changed course following the Pump.fun news.
How LaunchLab Differs from Pump.fun
LaunchLab distinguishes itself with support for multiple tokens and third-party fee settings, contrasting with Pump.fun's SOL-only approach. It also integrates with Raydium for liquidity protection. These features make LaunchLab a more versatile platform. According to Raydium's head, it is not meant to replace Pump.fun but provides an alternative for those preferring Raydium's pools.
LaunchLab's deployment could shift the dynamics in Solana’s memecoin sector. If Pump.fun migrates liquidity, Raydium could face revenue losses, but LaunchLab's success might retain liquidity within its pools.
