Pump.fun reportedly testing in-house AMM that could replace Raydium

Pump.fun, the popular Solana-based memecoin launchpad, is reportedly testing its automated market maker which could replace Raydium as the default decentralized exchange for graduated tokens.

The development was first spotted by X news aggregator platform Aggr News, which took notice of amm.pump.fun, a new liquidity pool under internal testing. If implemented, Pump.fun’s in-house AMM would allow the platform to capture more fees, potentially impacting trading fees on Raydium (RAY).

The shift comes as memecoins continue to command huge volumes in the DEX market. Pump.fun has already generated over $500 million in total swap fees, according to DeFiLlama. Currently, about 1.4% of tokens launched on the platform migrate to Raydium, meaning an in-house AMM could help keep more liquidity within the ecosystem.

The X community is speculating that this development could also pave the way for additional features like memecoin perpetuals and lending. Raydium could see a 30-50% drop in trading volume if Pump.fun moves forward with the transition. This would greatly impact Raydium’s market position. Raydium’s token, RAY, is already down 20% in the last 24 hours in reaction to the news, according to CoinGecko.

Beyond its liquidity shift, Pump.fun has been in the news for stopping a hacker connected to the recent $1.4 billion Bybit hack from laundering funds on the platform. Pump.fun blocked the attacker’s ability to transfer assets via Pump.fun’s infrastructure and stopped them from laundering stolen money through a memecoin launch.

Through a coin called “QinShihuang (500000),” the hacker had already pushed over $26 million in trade volume before being banned. According to blockchain data, the attacker moved 60 SOL to a different wallet before launching the token on Pump.fun, perhaps to mix and hide the stolen assets.