Solana is sinking along with Memecoin: when did the network take a wrong turn?

Memecoin frauds such as rug pullDevelopers attract investors to a project and then disappear with the money. and pump and dump schemesWhen the price of an asset artificially inflates (pump) and then plummets (dump), leaving investors with losses. have become very common on the Solana network over the past year. The popularity of memecoins has brought significant money to the blockchain, but there is another side to the coin: a negative impact on reputation and a drop in user trust. A platform for launching meme tokens based on Solana called Pump.fun, which was blocked by the UK Financial Conduct Authority (FCA) in December 2024. Pump.fun has also developed problems in the United States.

How the meme-coins gradually turned from a fan to a bench

Memecoins are crypto tokens tied to social or other events, such as the election of a new president, fresh memes, or high-profile news. Often, they have no real intrinsic value, as they lack the real-world applications that other cryptocurrencies have. At the beginning of their appearance, memecoins were a phenomenon around which a certain community gathered, whose members were united by a common idea and fan. But gradually, there was less and less fun and more and more sadness.

Back in the day, most of the old-school memecoins were launched on the Ethereum network. Base, by the way, is also a blockchain on Ethereum.

But over time, Solana began to take over the role of the central tool for launching memecoins. The network has high-performance and low fees compared to, for example, Ethereum.

The turning point was the emergence in early 2024 of a platform for the rapid creation and launch of memecoins called Pump.fun. It offered simplicity and a low price: no programming skills were required to create your own token, everything was done automatically in a few clicks. Pump.fun also has built-in tools for trading and managing coins with a user-friendly interface, and offers high-speed and low fees.

In addition, when a new token is created, a portion of them automatically goes into the liquidity pool, so you can trade immediately after launch. Over time, Pump.fun has become a kind of hype brand in itself, as it attracts traders and speculators to launch memecoins. Thus, viral projects began to appear on the platform.

Gradually, this simplicity and low entry barrier began to attract a dishonest audience: anyone can create their own token or trade on the platform. Pump.fun+ memoin madness = the market is flooded with thousands of useless coins. In his study, Syncracy Capital co-founder Ryan Watkins illustrated the effectiveness of investing in meme coins with Pump.fun: only 2 out of 2.44 million tokens reached a market capitalization of $500 million.

Inexperienced investors, in pursuit of money, easily swallowed the bait in the form of news about how another trader invested a few dollars and earned a million. In fact, only 3% of investors who bought tokens on Pump.fun earned more than $1 thousand and less than 0.8% of traders earned more than $10 thousand on the platformdata from Adam analyst as of August 2024).

Solana, what are you doing?

The topics to which the new memes were tied eventually raised moral and ethical questions. Suffice it to recall how Pump.fun launches a token in memory of a crypto guy with signs of mental instability who committed suicide on live TV. Do you want to livestream your own mother showing her breasts to raise a coin? Racism and anti-Semitism in the tokens «ni**a coin», «jewsdid911 coin», $JEWS? Anything to go viral and make money.

The explosive growth in memecoin trading allowed Solana to demonstrate in the fourth quarter of 2024 striking resultsApplications revenue grew 213% to $840 million, up from $268 million in the previous quarter.

However, a top analyst at DonAlt noted that Solana’s reputation has changed in a negative way due to fraud losses, which is also confirmed by the huge number of complaints from the crypto community on platforms such as Reddit.

Probably due to the growth of scam, Solana’s price fell by 9% in February 2025, and the number of active users decreased. It also added to the negative the story of the Libra tokenwhich was supported by Argentine President Javier Milei, which led to a $107 million rug pull. As a result, amid the overall cooling of the crypto market, this caused the SOL price to fall by 21%.

In February 2025, the price of Solana fell below $150, and the number of active addresses decreased by almost 40% compared to November 2024.

At the end of 2024, the blockchain detective ZachXBT exposed a $500,000 scheme targeting Solana meme fans. The fraudsters sent fake copyright infringement notices to force victims to reset their two-factor authentication (2FA) or passwords via phishing sites.

Memecoin fraud has significantly impacted Solana’s reputation and market performance, as the network has become a leader in launching meme coins. And, as a result, it contributed to the prosperity of fraudulent schemes.