On May 14, 2025, TopherGMI took to X to dissect Pump.fun's highly publicized "50% Creator Revenue Share" announcement, and the breakdown has sparked quite the conversation in the crypto community. What seemed like a generous move to incentivize coin creators on the Solana-based token issuance platform turned out to be a cleverly disguised fee hike for traders. Let’s dive into Topher’s analysis and what it means for the broader crypto ecosystem.

The Announcement: What Pump.fun Promised

Pump.fun made waves on May 12, 2025, with a bold claim: coin creators would now earn 50% of PumpSwap revenue. For every trade on a creator’s coin, they’d pocket 0.05% (5 basis points) in SOL, the native token of the Solana blockchain. The platform framed this as a game-changer, encouraging creators to build sustainable communities rather than dumping tokens early. With $10 million in trading volume, a creator could earn $5,000—a tempting incentive, right?

The announcement, paired with flashy graphics, looked like a win-win. Pump.fun even boasted about being the most rewarding launchpad for creators, a direct jab at competitors like Raydium and Bonk.fun. But TopherGMI wasn’t buying the hype.

The Reality: An Extra Fee on Traders

Topher revealed that the "50% revenue share" wasn’t Pump.fun giving up half its earnings. Instead, it’s an additional 0.05% fee tacked onto traders. Before the update, PumpSwap’s fee structure was straightforward: 0.20% for the liquidity pool (LP) and 0.05% as a platform fee, totaling 0.25% per trade. Now, with the creator fee share added, the breakdown looks like this:

• LP Pool: 0.20%
• Platform Fee: 0.05%
• Creator Fee Share: 0.05%

That bumps the total fee to 0.30%. In other words, Pump.fun isn’t sacrificing a dime of its own revenue—it’s still collecting its 0.05% platform fee. The extra 0.05% comes straight out of traders’ pockets, meaning the community is footing the bill to support creators. Topher called this out as "really misleading," arguing that Pump.fun’s marketing paints a picture of altruism when it’s actually just passing the cost onto users.

Why This Matters: Transparency in Crypto

This isn’t just about a few basis points (a basis point is 0.01%, so 5 basis points is 0.05%). It’s about trust and transparency, two things the crypto space often struggles with. Platforms like Pump.fun thrive on community participation—traders, creators, and holders all play a role in the ecosystem. But when a platform frames a fee increase as a "revenue share," it risks alienating the very users it depends on.

Topher’s critique resonates with a broader sentiment in the crypto world: users are tired of hidden fees and murky practices. For context, Pump.fun operates on a bonding curve model, where token prices increase in predefined steps as more tokens are bought (you can read more about bonding curves in this Medium article). This mechanism, while innovative, already generates most of Pump.fun’s revenue—Topher notes that bonding curve trades carry a 1% fee. So why, he asks, would Pump.fun "eek out an extra 2.5bps on the DEX" (PumpSwap) when it’s already raking in the majority of its profits elsewhere?

The Bigger Picture: Competition and Community Impact

Pump.fun isn’t operating in a vacuum. The platform faces stiff competition from players like Raydium, which recently launched its own token launchpad called LaunchLab (Arabian Post), and Bonk.fun, another memecoin launchpad. Both competitors have been putting pressure on Pump.fun to innovate, which might explain the timing of the revenue share announcement. Raydium, for instance, has been a key player in Solana’s decentralized exchange (DEX) space, and its native token RAY took a 25% hit earlier this year amid concerns over revenue loss to platforms like Pump.fun.

But Topher argues this move might backfire. By adding fees that burden the community, Pump.fun risks driving users to competitors who prioritize fairness. One reply to Topher’s thread from mrks put it bluntly: "Fuck @pumpdotfun. Use @bonk_fun." Another user, Rayguy, chimed in with a meme of a knight on horseback, declaring "Holder fees > Creator Fees," advocating for platforms like Raydium that prioritize communities over creators who might rug-pull (a term for when developers abandon a project after collecting funds).

The Community’s Response: A Mixed Bag

The thread sparked a lively discussion on X. Infra | Raydium pointed out fine print in Pump.fun’s announcement video, revealing that the 0.05% creator fee also applies to bonding curve trades—where the total fee is 1%. Topher was quick to note that 0.05% isn’t half of 1%, further questioning Pump.fun’s math and intentions. Others, like PDR, suggested that Pump.fun’s shift toward "web3" principles might be its downfall, hinting at deeper structural issues.

On the flip side, some users might see the creator fee as a necessary evil. After all, incentivizing creators to stick around could lead to stronger communities and less rug-pulling. But as Topher and others like dxrnelljcl pointed out earlier in the conversation, the numbers don’t add up. For $100 million in trading volume, a creator earns $5,000 (or about 28 SOL at current prices), but many developers rug coins for far less, often before even $1 million in volume is reached. This raises doubts about whether the fee will actually change creator behavior.

What’s Next for Pump.fun?

Pump.fun has been a massive success since its late 2023 launch, issuing tens of thousands of tokens daily and birthing hits like dogwifhat (WIF), which soared to billions in market cap (Yahoo Finance). But moves like this could erode its goodwill. If traders feel exploited, they might flock to alternatives, especially as the memecoin craze cools off—a trend already worrying platforms reliant on these tokens for revenue.

Topher’s thread ends with a rhetorical jab: this fee hike feels like an "unforced own goal." Pump.fun might have scored points for optics with its creator revenue share, but at what cost? For now, the crypto community is watching closely, and platforms like Raydium and Bonk.fun are ready to capitalize on any missteps.

What do you think—does Pump.fun’s fee structure cross a line, or is it a fair trade-off to support creators? Let’s keep the conversation going.