The recent growth of TRON’s meme token ecosystem may be redirecting traffic from Solana’s Pump.fun. Recent fee data show a slide in Solana fees, linked to reduced trading and traffic.
The recent launch of SunFun, the TRON-based meme token platform, may be impacting traffic on Solana. On-chain data shows Solana fees and tips to validators have gone down by 50%, coinciding with the launch of the latest project by Justin Sun.
Solana recently peaked in terms of fees, as Pump.fun had another peak month. The meme token marketplace saw a peak in fees and revenues in the middle of August, after another sprint in deploying new tokens. PolitiFi and other events, including the Neiro meme, re-sparked interest in Solana meme tokens.
As the meme frenzy reached its peak, Justin Sun launched his own meme token marketplace. Several tokens immediately launched and rallied to gain top positions on the platform, despite skepticism about insider trading.
On-chain data shows that the effect of Justin Sun’s market is already felt on Solana even though Pump.fun still dominates the market. Within just a few days, SunFun reached 50% of Pump.fun’s token mints, as well as value locked. On peak activity days, SunFun accounted for up to 40% of meme token volumes.
Solana fees reflect lower transaction activity
Since around August 12, when SunFun started its activity, Solana fees have fallen at a fast pace. The slowdown in fees and tips was already happening, but the launch of a new exchange accelerated the process. The Solana network and fees to JitoSOL slid from around 9,000 SOL to 1,500 SOL in 24 hours.
In the past week, JitoSOL achieved $3.7M in fees, while the entire Solana chain logged $5.19M. A crash in fees would affect not only SOL but also the JTO token, which grants passive income from staking.
The Solana meme coin frenzy is one of the chief sources of fees to validators. Regular Solana usage is cheap, but MEV bot usage, priority fees, and tips can run up significantly if a buyer wants to make sure the transaction and the trade will be filled.
An outflow of meme coin snipers and bots would affect the whole Solana fee profile, undermining the network’s reputation. Fees are key to Solana, as the main source of earnings for validators and as a source of income from staking.
TRON-based memes try to find a place on social media
Other meme marketplaces have found it hard to compete with Pump.fun due to its first-mover advantage. Moonshot shows a smaller number of tokens in its portfolio. Base also carries a token launchpad, as well as Toncoin, but with much lower volumes.
This makes TRON’s move to topple Pump.fun an ambitious task, even if it is often attacked by critics. Over time, the TRON network has carried almost all versions of crypto trends, including NFT, earlier meme tokens, Web3 games and DeFi. TRON ran its version of TronDogs as early as 2018, copying the model of CryptoKitties.
Most of the TRON projects relied on a segregated user base, as well as their own sources of liquidity. Critics also predicted Justin Sun’s meme token platform will not survive two weeks.
Tron meme is about to explode soon. I saw a hater once predicted that Tron meme wouldn't survive two weeks. Well, it's been two weeks now. Then I saw him say：Nothing can stop Tron now. Is it still possible to join Tron in time?
— H.E. Justin Sun 孙宇晨(hiring) (@justinsuntron) August 29, 2024
Meme token platforms are heavily driven by bots and sniping, and some of the bots already have multi-chain capabilities. With those tools, traffic and sniping could easily shift to a new launchpad, especially if the memes are appealing.
So far, SUNDOG and SUNCAT are the most active tickers. The projects now aim for social media loyalty. SUNCAT also stressed its fair distribution and lack of visible wallet clusters. As for SUNDOG, the asset has already established trading volumes and is awaiting a breakout.
The TRON ecosystem currently carries more than $23B in value locked, with around $5.4B for Solana. Interest in meme trading also led to a new report of 254K accounts created in the past day alone. It is difficult to determine how much of TRON’s traffic is organic or created by automated bots.
The network usually has between 2.4M and 2.6M daily active accounts, a rather predictable daily baseline. TRON remains the network with the highest generated fees, with more than $71M in the past week. TRON traffic also hinges on the usage of stablecoins and its own DeFi ecosystem. Increased traffic boosted the native TRX token, which recovered to $0.16.
Cryptopolitan reporting by Hristina Vasileva
