The Next Chapter for Pump.Fun | Co-Founder Alon

Alan, I think some listeners, maybe maybe most listeners, will see the title of this episode when they when they clicked on it, and they'll say, like, oh wow, Pump Fun on Bankless. That is a weird combo. Why Bankless? Of all the podcasts that are out there, there are more like Solana uh interested podcasts. There's, you know, plenty there's plenty of options. Uh why Bankless?

Welcome to Bankless, where we explore the frontier of internet money and internet finance. Today on the show, I'm hosting a conversation with Alan, a co founder of Pump Fun, the meme coin launchpad on Solana.

The idea of Pump Fun being on Bankless is probably already surprising to many listeners. Bankless has not necessarily been the strongest advocate of meme coins, mainly due to their inert nature and destructive market behavior that meme coins tend to create.

I did my best in this interview to give Alan both a fair shot explaining what he sees in meme coins while also not ignoring the reality that Pump Fun has been at the forefront of one of our industry's most extractive market cycles, leaving behind it a trail of destroyed capital, as what started out as a relatively innocent meta of fun speculation turned into structural and systematized extraction into the hands of just a few players.

I went into this interview with Alan cautiously. I'd never met the guy before, and I'm wary of the idea of platforming a project that might just inherently be stuck in creating only toxic outcomes for its users.

I'm also wary of the idea that Pump Fund might be attempting to use bankless to launder its reputation as it tries to turn a page with its product offerings with the recent introduction of Pump Swap, an AMM DEX on Solana.

During this interview, I also couldn't get the idea of Operation Berkshire out of my head. For those that don't know, Operation Berkshire was a conspiracy by Big Tobacco to publicly deny the existence of health risks associated with smoking and also fund pro tobacco research and generally undermine scientific consensus about tobacco. The tobacco industry tried to influence policy and public opinion through front groups and media campaigns in pursuit of market growth by their industry.

There is a chance that meme coins are inherently stuck being something like tobacco for public health. I think anyone working on pump fun is incentivized to not think that this is the case.

But we are in the early days of crypto, and we are still in the early days of meme coins. The future is not yet written. There is a possible future out there for meme coins that are more productive, and meme coins at the end of the day are just a logical conclusion of what crypto brings to humanity the permissionless ability to create a financial asset.

So, whether we like them or not,

whether they represent a scourge on public health or the beginnings of a more equitable future,

this will be determined by the leaders of the meme coin industry.

And with that preamble out of the way, let's go ahead and get right into the conversation with Alan from Pump.fun. But first, a message from some of these fantastic sponsors. Bankless Nation, excited to introduce you to Alan. He is the co-founder of Pump.fun. Pump.fun, by now, I don't think it needs any introduction. It's the uh token launch pad on Solana, primarily known for launching meme coins. At its peak, over 60,000 tokens were being launched on Pump.fun per day back in January. I think today we are somewhere near 9 million total tokens that have ever been launched on the Pump Fun platform since its launch in January of 2024, with about 15 million unique addresses interacting with the Pump Fund tokens. Pump Fund charges a 1% fee on all trades that go through its bonding curve model, which has generated Pump Fund an astounding $600 million of revenue to pump the company and its investors, making it one of the most wildly successful applications in the crypto space in recent times. Alan, welcome to Bankless.

Thanks for having me, David. Really excited to to chat about pump fun, meme coins, anything that we want to discuss, especially addressing your audience is is a major privilege. So, you know, thanks again.

I think uh like I said, people understand pump dot fun. And also, by the way, pump dot fun or pump fun?

Yeah, I've been struggling with that myself. I I I I loved pump.fun at first, but I think the users

like saying pump fun. So you gotta go with with what's organic with what people are saying out there. So I say pump fun these days.

Okay, pump fun. Maybe you can just give it a little bit of color to your genesis, your background pre pump fun, and then just start the uh conversation off with like the idea inception of pump fun in the first place.

Yeah, absolutely. So as for myself and and you know my two co founders as well, we've been in the space for a while. We

I think all of us have gone through the space by being retail traders, getting into the space, getting you know, buying Bitcoin and ETH and Doge and stuff like that. I think you know, we got more and more into it over the years. Ultimately, we worked in a few different projects. Myself personally, I was uh quite deeply involved with a project called uh NFT Perp, which is a features exchange for NFTs and an Arbitrum back in the day. Uh so we were quite involved on the you know, and the DeFi side of things was

very exciting. We

obviously saw that there is something to it and something to

you know I mean so for for for

for NFT purpose specifically, we saw the product market fit that, you know,

that collectibles trading could have.

And

We, you know, after experiencing Terra Luna, after experiencing FTX, we saw that the market was kind of going down and that NFTs might not have the longevity that we thought they would have. So we wanted to experiment with some new ideas. So I I quit that role and started experimenting with some with you know my who were to become my two co founders with a bunch of different ideas that we had uh in the space. We're actually built mainly building on Ethereum or or or its L2s. Uh, you know, a few people know this. So we've actually come from that, you know, from the ETH ecosystem, just building different things, start off in NFTs.

You know, built some stuff in Socifi, got traction for basically nothing. I'd say we we were chewing glass for like for at least a year. For one of my co-founders, would say even for longer, like two plus years, just really iterating, shipping, building MVPs for things that we thought people would want. Honestly, when we got started, we we weren't that good at it. We were building stuff that we thought was cool, or we thought that, you know, we saw that there was going to be a trend in the market and we were building for what we thought would work in a few years' time, but we weren't actually building for users today, you know, like weren't actually speaking to users properly and uh and actually building something that solved their problems today. So as we iterated, as we tried more and more things, we

You know, we got better at our craft. But the problem was that we were building problem spaces that we didn't understand. I think, you know, one idea that we built, we built like uh we were trying to build this creator

fundraising marketplace. We're not, you know,

natively, we're not, we're not, you know, content creators. What we've done, what got us into crypto was trading on chain, trading NFTs, you know, buying NFTs, minting NFTs, buying coins on chain, whether it's Ethereum or buying that smart chain or whatever.

And ultimately, when we saw people starting to trade meme coins on Solana, so in particular, in particular, Bonk with all these kinds of assets, we thought that that was interesting. I mean, look, we were we were actually quite hesitant to go to Solana because we never used it before. We were really comfortable, you know, building on ETH. And I think our last project was before moving over, was on base. Developing on Solana back then was kind of a pain. Like we weren't really looking forward to it. But look, we were we were quite desperate at that point. And we wanted we wanted to get users, and the users were there. So that's where we were going. Like it from my perspective, or from my the perspective of my co friends as well, I'm sure they they'll say the same thing. If the users were on Cardano, like we would go to Cardano to go and get to go and build our product, like whatever it, whatever it takes. So we saw that it was on Solana, we started.

We started experimenting or s uh you know experimenting with the products there.

We did see the potential of what was taking place. There's clearly a lot of excitement. Like we felt like we were at the beginning of of a new wave. You know, the the fact that that transactions were landing super smoothly, super fast. We we enjoyed using Phantom.

You know, trading on-chain, trading on Jupyter, for instance, and and and so on.

But we noticed that there were some major issues with with the market structure, with the way that people were actually

exploring coins, the way they were creating them, and ultimately what they were trading.

One thing that was very popular back then was people conducting pre sales for meme coins, right? They were

they they posted a wallet address on on Twitter or whatnot,

and people were sending funds there.

We saw that there so a lot of people were just sending their you know their soul to to these pre-sales. And half the time, you know, the pre the the coin wasn't even launched. It was a total shit show. There's no standardization whatsoever. And people didn't know what to expect. And even when it did go well, the the people that created these coins were uh you know, they reserved like 50% of the raised funds to marketing, which is like, you

know, excuse my language, it's total bullshit. You know, you don't need like millions millions of dollars to uh to market your your meme coin. So it didn't make none of that made any sense. At the same time, you know,

it was really painful trading on on AMMs or indexes, whatever you want to call them.

Getting liquidity pulled from those from LPs,

buying honeypots, buying coins that drained your entire wallet. It was a really brutal experience. And one experience that,

you know, on on in the Ethereum ecosystem that I particularly looked very fondly upon was

was Frontech. Like I really love that idea. I think.

I mean, we there's a deeper conversation behind that about, you know, how it ended up playing out and if it was mismanaged or whatnot. But I love, love, love the idea of being able to bootstrap small token communities with no need to actually

commit capital up front. Just

coming up with an idea or yeah, just coming up with an idea or anything and being able to bootstrap a bootstrap liquidity for that using bonding curves. So ultimately the model that we came up with is

you don't need to come commit capital up front to create coin.

Whenever enough people or whenever the the the market suggests that you know it's it's successful enough, whenever enough capital was kind of or or cash was committed.

The liquidity in the bonding curve was going to be used to create a liquidity pool, which is burned. And, you know, whenever that that coin is created, all permissions

and all that kind of stuff was revoked from the coin creator. So it was truly,

you know, once it was created, it was truly permissionless, truly immutable. You can't tamper with it. And whenever we release that to market, we very quickly noticed that it will work. It took us a while to make it work, but we we were very much.

You know, we were very optimistic about

the prospects of the product.

This is actually triggering a memory for me about the pre pump era.

Maybe, maybe this is most of

the exemplar example of this is the Slurf incident where we had this one Solana developer who like publicized, like, I'm doing a pre-sale for my meme coin that I'm going to launch. There's no pump.fun platform to do that. And so this would you would just send your money to this trusted individual who would manage it and then launch a meme coin, add the soul to an LP position, and then that's how the meme coin would launch. And then Slurf, this one incident, he accidentally burned the LP token because he didn't really know what he was doing. And there's that famous, the famous like tweet or something. It says, guys, I think I accidentally burned it or I'm so fucking sorry. And so I think this is kind of like illustrating the pre market structure that existed in the meme coin space before Pump came and just offered a like a commoditized platform for just doing.