Pump.fun Introduces Creator Fee Sharing System to Rebalance Platform Incentives

The announcement came from co-founder Alon Cohen in his first post in 65 days and immediately pushed the platform’s PUMP token up more than 10%.

The new Creator Fee Sharing system lets project teams distribute fees to up to 10 different wallets, transfer coin ownership, and revoke update authority. Both creators and Community Takeover (CTO) administrators can now assign specific fee percentages after a token launches through Pump.fun’s web and mobile interfaces.

Why Pump.fun Changed Its Fee Model

Cohen explained that the platform’s Dynamic Fees V1 system, introduced in September 2025 as part of Project Ascend, successfully attracted new builders and doubled bonding curve volumes. However, the system created a dangerous imbalance by encouraging low-risk token creation instead of high-risk trading.

“Creator fees may have skewed incentives toward low-risk coin creation instead of high-risk trading, which is dangerous, because traders are the lifeblood of the platform,” Cohen wrote in his announcement.

The previous fee structure used tiered rates based on market capitalization, with smaller tokens earning up to 0.95% per trade and fees declining to as low as 0.05% as projects approached $20 million valuations. While this helped organized teams with long-term plans, it did little to change behavior among typical memecoin deployers who continued launching low-effort tokens.

Source: @Pumpfun

The platform acknowledged that teams often struggled to share fees transparently, sometimes requiring community takeovers or relying on informal trust arrangements. The new system addresses these friction points by synchronizing fee claims across all recipients and ensuring unclaimed fees remain permanently available to assigned wallets.

Platform Activity Rebounds to September Levels

The platform hit an all-time high daily trading volume of $2.03 billion on January 6, generating $1.53 million in daily revenue and becoming Solana’s second-largest decentralized exchange behind Meteora. Weekly trading volume reached $6.6 billion, while creator earnings topped $1.1 million in 24 hours and $7.9 million over seven days.

This surge represents a significant recovery for Pump.fun, which had experienced an 80% decline in revenue from its January 2025 peak. The platform briefly lost market share to competitor LetsBonk in July 2025 but regained dominance through aggressive token buybacks and the Project Ascend creator program. Pump.fun now controls approximately 73-80% of Solana memecoin launches.

Market-Based Approach Coming in 2026

Cohen emphasized that the creator fee sharing update represents just the first step in a broader series of changes planned for 2026. Future iterations will adopt a “market-based approach” that lets traders, rather than deployers, determine whether a token narrative deserves creator fee support.

The platform is shifting its focus from rewarding token creation to empowering the traders who provide liquidity and generate trading volume. Cohen stated that no member of the Pump.fun or Terminal team will accept creator fees under any circumstances, describing the feature as being “for trenchers”—slang for active traders in the memecoin space.

Fee claims under the new system can be made at any time through the platform’s interface and never expire, giving teams full flexibility over when and how they access their earnings. This structure aims to reduce the pressure on creators to immediately extract value and instead encourage longer-term project development.

PUMP Token Responds to Announcement

The PUMP token jumped over 10% following Cohen’s announcement, though it remains down more than 73% from its all-time high of $0.00878 reached in September 2025. The token traded around $0.00227 on January 10, with a market capitalization between $806 million and $975 million depending on circulating supply calculations.

Trading volume for PUMP reached $121-234 million over 24 hours, reflecting renewed interest following two months of relative silence from the project’s leadership. The token has shown 30% weekly gains despite broader volatility in the memecoin sector.

Pump.fun has allocated over 98% of its platform revenue to token buybacks since launch, having retired approximately $213 million worth of PUMP tokens and reducing circulating supply by 14.75%. This represents one of the most aggressive buyback programs in the cryptocurrency sector.

Legal and Competitive Challenges Ahead

The platform faces significant headwinds despite its strong activity metrics. A $500 million lawsuit filed in the Southern District of New York accuses Pump.fun’s co-founders of operating an insider-driven system that favored privileged participants. The suit alleges insiders gained early access to newly launched tokens at minimal prices before exiting positions at retail investors’ expense. A court decision on whether the case can proceed is expected January 23, 2026.

Critics have pointed out that approximately 98.6% of tokens launched on Pump.fun become rug pulls—projects where developers abandon the token after extracting funds. While Pump.fun has generated over $935 million in revenue, users are alleged to have lost between $4-5.5 billion in total.

The platform temporarily suspended its controversial livestreaming feature in November 2024 after creators used it for increasingly extreme stunts to promote tokens. The feature was relaunched in April 2025 with improved moderation infrastructure.

The Road Forward

Pump.fun’s creator fee sharing system represents an attempt to correct incentive structures that prioritized token deployment over sustainable trading activity. Whether the changes succeed in fostering higher-quality projects while maintaining the platform’s accessibility remains to be seen. With additional updates promised throughout 2026 and ongoing legal challenges, the coming months will prove critical for the platform’s long-term viability in the competitive Solana memecoin ecosystem.