Pump.fun Launches Investment Arm as Memecoin Trading Slows

Pump.fun launched a new investment arm. Trading activity on its meme coin platform cooled from last year’s peak. The Solana-based launchpad said the initiative will deploy $3 million through a 30-day program designed to fund early-stage projects.

The effort centers on a hackathon format that requires teams to launch tokens and attract users in real time. Pump.fun framed the move as a shift away from traditional venture capital selection and toward open market participation.

Pump.fun Introduces a Market-Driven Alternative to VC Selection

Pump.fun said its new unit, Pump Fund, will finance 12 projects with $250,000 each at a $10 million valuation. The program removes panel-based judging. Founders issue tokens to showcase their projects. Users determine demand through on-chain activity.

The company said the model relies on community participation. It replaces investor access as the basis for fundraising. It also makes community involvement central to early validation.

Source: X

More so, the hackathon is open to projects across sectors and stages. This includes teams that are not building crypto-native products. Pump.fun said it will prioritize “organic traction” rather than founder reputation or professional networks.

To qualify, participating teams must hold at least 10% of their token supply while building publicly. More so, regular updates are expected on social platforms and within Pump.fun’s ecosystem.

Hackathon Structure Requires Live Token Launches

The “Build in Public” hackathon will run for 30 days. It ends on February 18, with results announced at the close of the program window. Pump.fun said founders will need to demonstrate progress while communities interact with the token in the open market.

The format links capital allocation to user participation, placing attention and market activity at the center of how projects are evaluated.

Pump.fun also said selected teams will receive mentorship directly from its founders. The company positioned the program as support for builders who communicate frequently with their communities.

The program fixes the investment amount and valuation structure. It ties selection to user onboarding. It measures success by retaining real users during the hackathon.

Pump.fun Volume Drops as Capital Rotation Continues

Pump.fun’s announcement comes as activity on the platform has declined after last year’s surge. Industry trackers reported that Pump.fun hit a peak monthly trading volume of $11.75 billion in January 2025. By December, its volume had dropped sharply to $2.43 billion.

The slowdown follows a broader cooling phase in memecoin trading after a period of heavy speculation across Solana-based token launches.

Market data also shows short bursts of activity across meme assets that have not consistently translated into higher overall valuations.

In recent sessions, meme coin trading volume rose sharply while sector market capitalization fell. This suggests traders were rotating positions rather than adding new capital.

Transparency, Governance, and Legal Questions

Some analysts raised questions about how Pump.fun will measure traction and prevent manipulation during the hackathon. Musheer Ahmed, founder and managing director of Finstep Asia, said the model needs clearer governance.

He emphasized stronger distribution rules. He noted this would help reduce concerns about biased decision-making.

Also, he emphasized the need for mechanisms to verify that user activity is critical. Such systems must confirm genuine engagement. They should prevent reliance on automated traffic.

Pratik Kala, head of research at Apollo Crypto, described the concept as a form of social proof. He compared it to markets that surface demand signals quickly. At the same time, he noted that token-based funding models can vary widely in how rights and value are handled after fundraising.

Kala referenced earlier efforts in the sector that used tokens to bootstrap interest. Those efforts lacked clear accountability structures. They also failed to provide long-term returns to holders.

The rollout of Pump Fund follows a difficult period for Pump.fun’s public image in 2025. At that time, the platform paused its livestreaming feature amid content concerns.

The company faces a class action complaint. The case alleges its parent entity ran an illegal securities exchange. It reportedly facilitated large-scale unregistered token issuance while collecting substantial fees.