Charlie Munger once said: “Show me the incentives and I’ll show you the outcome.”
Then, you can launch a new trading pair by achieving a token’s market cap of at least $100k.
There are also alleged stunts that involve the consumption of dog faeces.
This list sums up all the mundane attempts to get attention in memecoins. The race for attention is on full display thanks to the livestream function built into pump.fun.
Memecoins are based on attention, so the outcome is not surprising.
This has led to a demand for regulation or a banning of the memecoin launching tool that is currently trending on Twitter. There are already fake images of Polymarkets predicting a ban on pump.fun and the SEC seizing pump.fun’s website.
Alon, the founder of pump.fun, acknowledged the issue over the weekend and said that the platform’s moderators were to blame. “working around the clock” Quash the “illicit content.” It’s easier said than accomplished, given that thousands of memecoins are being released every day.
But realistically, what can a regulator really do?
US regulators for example could pressure internet providers to block the domain pump.fun, but VPNs would easily be able circumvent this ban.
Tokens live on the Solana chain. Regulators can technically pressure validators into blocking transactions, similar to how the US Treasury imposed sanctions against Tornado Cash in 2020.
Ironically, this is a parallel to the problem that Big Tech has been facing with its social media platforms for years. If illegal content is posted on Facebook, who should be held legally liable — the user or Facebook?
Free speech advocates in the US have argued Section 230, of the 1934 Communications Act, protects illegal user-generated material on platforms.
Pump.fun may be able to withstand regulatory pressure if they follow this logic but not the market forces.
The success of Pump.fun has been copied dozens times. Makenow.meme is on Solana; sun.pump is on Tron. “Clanker,” A kind of AI-powered version of Pump.fun, where memecoins are deployed for free into a Uniswap v3 Pool with a Farcaster Tweet.
Clanker has been launched for a little more than two weeks and according to Farcaster’s co-founder Dan Romero, it has already collected $4 million in fees.
Pump.fun offers plenty of incentives, whether they are regulatory hammers or the market competition to nip a problem like this in the bud.
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