Solana-based memecoin deployer Pump.fun has transferred 132,000 SOL worth around $22.88 million to Kraken. The move continues the protocol’s practice of selling off SOL, which is collected as transaction fees.
According to EmberCN, Pump.fun has sent SOL to Kraken every week or two after accumulating transaction fees. The popular memecoin launchpad had already deposited 105,233 SOL tokens worth around $16 million to Kraken on May 3.
Pump.fun recent SOL sales (Source: EmberCN)
EmberCN said:
“Pump.fun will transfer these SOLs to Kraken after accumulating one to two weeks of transaction fee income.”
With the recent sale, Pump.fun has sold over $38 million worth of SOL this month alone. While this reflects its selling behavior, the fact that it deposited a higher amount of SOL in its latest transfer than more recent ones suggests that it might be seeing a resurgence in activity, driving up its transaction fees.
Data from Dune Analytics support this, with the protocol seeing an increase in its daily volumes this month. In the last 24 hours alone, over 26,000 tokens have launched on the protocol.
Pump.fun sells over $700 million SOL in more than a year
While the recent selloffs by Pump.fun are not surprising, the timing brings back the debate over the impact of the memecoin launchpad on the Solana ecosystem. On the one hand, the platform allowed Solana to become the leading network for memecoins, thereby boosting the chain activity.
However, concerns about how Pump.fun is only extracting value from the Solana ecosystem have grown with every SOL sale by the protocol, with many believing it has caused more harm than good.
Despite the differing opinions, the one clear thing is that Pump.fun SOL sales represent a major selling pressure for the token. Interestingly, the platform has sold 3.868 million SOL tokens worth over $701.76 million in more than a year, with an average price of $183.3.
Its latest sales even coincide with the SOL price resurgence, leading to speculation that it might be taking profits. The token has seen a 45% rise in value in the last 30 days, making it one of the best performers in that period.
Meanwhile, SOL is now trading around $171, with its value steady over the last 24 hours despite the recent sell-offs by Pump.fun. Although the token is still down 11% year-to-date, many see the recent gains as a sign of optimism and resurgence.
Memecoins are up 82% in average price in the last four months
SOL’s positive performance reflects the gains of the memecoin sector in recent weeks. According to CoinMarketCap, the sector has seen an increase of 58.78% in its market cap over the last 30 days, while the average price has also increased by 82.43%.
Almost all the major cap memecoins, starting from the leading token DOGE, have recorded at least double-digit gains in the past month. Outliers such as WIF, PENGU, BRETT, and PNUT have even seen over 100% increase in value.
While the broader market performance has also influenced memecoin gains, the sector’s substantially higher growth during the period suggests that investors might be interested in memecoin again.
Still, not everyone is sold on memecoins. A recent report by Solidus Labs claims that 98.6% of tokens launched on Pump.fun are pump and dump schemes or rug pull while. It added that only 97,000 of the seven million memecoins launched through the platform had maintained at least $1,000 liquidity.
The report represents a criticism of a sector many believe exemplifies everything wrong with the crypto industry, where bad actors continue to embezzle billions and retail investors leave with losses.
However, Pump.fun has pushed back on the criticisms, stating that the long-term worthlessness of memecoins is a feature, not a bug. The protocol spokesperson, Troy Gravitt, stated that a functioning marketplace for those who want to trade is more important.
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