SOL is the winner as Solana chain turns into battleground for meme coin launchpad and DEX

Solana (SOL) gains nearly 2% in the last 24 hours and trades at 118.28 at the time of writing on Thursday. A Decentralized Exchange (DEX) and a meme coin launchpad built on the Solana blockchain have waged a war for users and compete for the trade volume on the chain. 

Solana emerges as a winner in either case, as both projects are built on the SOL chain. 

Solana-based protocols battle for dominance

Pump.fun, the meme coin launchpad that shot to fame for driving higher revenue and trade volume to the Solana blockchain, severed its partnership with Raydium, a Solana-based DEX. As Pump.fun pulled the plug on the relationship with the protocol, it launched its own DEX to facilitate the trade of meme coins launched on the platform. 

The war has led to intense competition to capture market share, users, and transaction volume. Both Raydium and PumpSwap are battling for users, and while Raydium struggles, Pump.fun has captured higher value with its meme coin launchpad, according to a K33 research report published on Wednesday. 

Pump’s Automated Market Maker (AMM) DEX is less than a month old, and both platforms are waiting for a rebound in user sentiment and market conditions to drive growth. Pump.fun’s DEX has slowly chipped away at the token volume, as observed by K33 research analysts. 

Pump.fun’s DEX and Raydium | Source: K33 research report

Solana could gain from the battle in the trenches

Solana has yet to face a setback from the competition between the protocols. While Pump.fun and Raydium compete, SOL has consolidated below  $136. The $146 level is a key resistance, while  $112 is an important support. 

SOL adds nearly 2% to its value in the last 24 hours and trades at $118.28 at the time of writing on Thursday. 

The Relative Strength Index (RSI) indicator reads 38, holding above the “oversold” zone and signaling slight bearish momentum. Meanwhile, the Moving Average Convergence Divergence (MACD) shows short red histogram bars after flashing green histogram bars above the neutral line for nearly two weeks, suggesting indecision and a shift in interest among traders. 

If Solana sustains its gains, the token could rally nearly 23% and test resistance at $146.03. However, if Bitcoin faces a flash crash or sudden market correction, SOL could slip to support at $112. This would mark an over 5% decline in Solana’s price. 

SOL/USDT daily price chart 

Beyond price performance and incentives, market sentiment remains key for meme coins. Pump.fun has pivoted to take control of the declining revenue amidst dropping activity. For the meme coin launchpad to return to previous levels, a market-wide rally may be required.