On May 12, PumpFun, a popular Solana-based memecoin launchpad, rolled out a creator revenue sharing model that redistributes 50% of the trading fees from its decentralized exchange, PumpSwap, to token creators. This move aims to shift the dynamics of the memecoin ecosystem. But as the dust settles, the community’s mixed reactions and underlying concerns raise questions about the model’s long-term impact. How the Revenue Sharing Model Works The structure is straightforward. Creators earn 0.05% in SOL for every trade on their token, meaning $10 million in trading volume translates to $5,000 for the creator. This applies to newly created tokens, those still on PumpFun’s bonding curve, and tokens that have migrated to PumpSwap. To claim rewards, creators can log into their PumpFun profile with the wallet used to create their coins, navigate to the “coins” section, and claim their SOL earnings. The process is automated and on-chain, allowing creators to withdraw rewards at their convenience. This model positions PumpFun as a potentially lucrative platform for creators. With over 8.8 million tokens launched since 2024, according to Dune Analytics, and PumpSwap accounting for 15% of PumpFun’s $2 million daily revenue, the financial incentive for creators is clear. Yet, the community’s response reveals a more complex picture. Community Reactions: A Divided Perspective While some creators welcome the opportunity for sustained income, others in the Solana ecosystem are skeptical. A key concern centers on the potential for abuse. Critics argue that the model might reward developers who launch tokens only to abandon them—commonly known as a “rug pull.” One pseudonymous trader, 0xRiver, voiced this sentiment on X, stating that rewarding creators of community takeover (CTO) coins, which make up 99% of memecoins, could incentivize bad actors to launch low-effort tokens, collect fees, and exit without supporting their projects. Traders also feel overlooked. The model offers no plans to share revenue with traders, who bear the brunt of market risks. Some community members have suggested alternatives, like allowing communities to vote on who the “creator” should be for revenue-sharing purposes, especially in cases of abandoned tokens. This idea aligns with a recent teaser from PumpFun founder Alon Cohen on May 16, 2025, about a forthcoming CTO feature that would redirect the developer’s share of trading fees to communities reviving abandoned memecoins, such as the successful Dogwifhat (WIF). Analyzing the Model’s Implications The revenue-sharing model aims to incentivize creators to build lasting projects rather than focusing on quick profits. Historically, many Solana memecoin developers profited by buying their tokens at launch and selling into retail demand, often leading to pump-and-dump schemes. By tying earnings to trading volume, PumpFun hopes to encourage creators to foster active communities and sustain interest in their tokens over time. However, the model isn’t without risks. The ease of creating memecoins on PumpFun—over 5.5 million unique tokens since January 2024—raises questions about the value of creators in this ecosystem. With such a low barrier to entry, the model might attract more speculative projects, potentially increasing wash trading and artificial volume inflation. Security is another concern. Complex reward systems could introduce vulnerabilities, creating new attack vectors for exploits in smart contracts. Additionally, the fee structure has drawn scrutiny. Previously, PumpSwap charged a 0.25% fee per trade (0.20% to liquidity providers, 0.05% to the platform). The creator revenue share adds another 0.05% fee, which some argue is effectively passed on to traders rather than being funded by PumpFun itself. This shift could deter traders if fees become uncompetitive compared to rival launchpads like LetsBonk. Looking Ahead: Balancing Incentives and Risks PumpFun’s revenue-sharing model is a bold step toward aligning creator and community interests in the memecoin space. The upcoming CTO feature could address some concerns by empowering communities to benefit from abandoned projects. However, for the model to succeed long-term, PumpFun must consider safeguards—such as mechanisms to penalize rug pulls or incentivize trader participation—to maintain trust in the ecosystem. Creators looking to benefit should focus on building genuine communities and promoting their tokens responsibly. Monitoring trading volume and understanding fee mechanics will be key to maximizing earnings. For traders, staying informed about PumpFun’s evolving fee structure and upcoming features will help navigate this shifting landscape. At its core, PumpFun’s initiative reflects a broader push in DeFi to rethink how value is distributed. Whether it will foster innovation or exacerbate existing challenges remains to be seen.