The memecoin launch platform pump.fun announced two changes to its token mechanics: it has launched Holder Rewards and discontinued support for the Cashback mode for new launches.
From now on, token creators can choose one of two models: a standard token with a creator fee or a token with holder rewards.
How do Holder Rewards work?
For tokens with Holder Rewards, fees are directed to a special pump.fun distribution wallet. The platform automatically distributes rewards among holders several times an hour on a pro-rata basis. This means the more tokens a user holds in their balance, the larger their share of the reward.
Users holding tokens worth over $20 are eligible for rewards. Rewards are paid out in the quote token of the pair. For example, for a pair with $SOL, payments are made in Solana, and for a pair with $PUMP — in $PUMP.
Teams and communities of already launched tokens with Cashback or Creator Fee can apply to switch to Holder Rewards. pump.fun noted that decisions on such applications will be made based on objective information and the potential benefit for the token and its community.
After switching to Holder Rewards, it will not be possible to revert to the previous model.
For custom pairs, when switching, a fixed fee from 0.01% to 3% must be set. For pairs with $SOL or $USDC, a standard multi-tier fee structure will apply, which depends on the token's market capitalization.
According to pump.fun, protocol fees remain the same for all token types. For $SOL/$USDC pairs, a multi-tier model will be in effect: the fee decreases as the token's market cap grows.
For Custom Pairs, the creator can set a fixed fee within the range of 0.01% to 3%. Once set, it cannot be changed.
pump.fun explained that the new Holder Rewards model is designed to incentivize users to hold tokens longer and support the development of their communities.
As a reminder, pump.fun previously expanded its platform with tokenized stocks featuring the Custom Pairs function.
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