fomo Launches Trader Rewards Program to Compete with Pump.fun
Paul Erlanger, co-founder of the crypto social trading platform fomo, recently retweeted an official account's post on social media promoting the platform's "Earn rewards, Pay it forward" trader rewards program, claiming fomo is "a trading app for the common people."
According to reports, fomo's recently launched "Trader Rewards" program has paid out approximately $2 million to users in the past week; additionally, public data shows that the platform's referral program has issued over $2 million in rewards to users to date.
The report indicates that fomo's enhancement of its user rewards program is seen as its latest move in the "arms race" for trader traffic against another major memecoin trading platform on the Solana chain, Pump.fun. Unverified reports previously indicated that Pump.fun offered top traders and influencers up to $30,000 per month to trade exclusively on its platform; Pump.fun also launched social trading features on August 7, driving its daily active user count to a record high, while its $PUMP token rose 87% over 30 days during the same period.
Data shows that on September 5, fomo's daily revenue reached $1.76 million, surpassing Pump.fun's $1.1 million on the same day; however, over the past 30 days, Pump.fun led significantly with $57 million in revenue compared to fomo's $17.6 million. fomo had also set historical trading volume records for six consecutive weeks, and on August 6, briefly surpassed trading platform Axiom in daily fee revenue, with its Solana chain trading volume accounting for over 50% of the company's total trading traffic.
The report mentions that fomo launched perpetual contract trading based on Hyperliquid for users outside the U.S. in June this year; the platform has gained over 68,000 new users who made their first cryptocurrency purchases via Apple Pay, with a total transaction amount of approximately $25 million. The company completed a $75 million Series B funding round led by Index Ventures in June, with a valuation of $550 million.
fomo adopts a fee-based model focusing on copy trading, cross-chain functionality, and social position displays, while Pump.fun has long used a zero-fee model, attracting users with a bonding-curve mechanism and social features, allocating about 50% of its revenue for programmatic token buybacks; the differences in customer acquisition strategies are also the core background of the direct competition over "user rewards."
Source: Public Information
ABAB AI Insight
The competition for trader traffic between Solana-based memecoin trading applications is not new—early in 2024, Pump.fun rapidly captured the market with its zero-fee bonding curve token issuance model. Subsequently, several trading terminals, including Photon, BullX, and Axiom, also competed for the same group of high-frequency traders through rebates and point rewards; fomo's response with its "Trader Rewards + Referral Program" continues the industry's historical pattern of "subsidizing for traffic," but this time the scale of subsidies has escalated to the level of "$30,000 monthly retention."
In terms of capital flow, fomo completed a $75 million Series B funding round in June, with a valuation of $550 million, and is now investing millions into its user rewards program, essentially converting primary market financing directly into secondary market customer acquisition subsidies, using real cash short-term discounts to exchange for user retention and sustained trading volume growth, to showcase a stronger growth curve in the next funding round or valuation reassessment; on the other hand, Pump.fun chooses to allocate about 50% of its revenue for programmatic buybacks of $PUMP tokens, converting operational income into price support for the tokens. The difference in capital investment directions reflects the two companies' choices of "equity financing to acquire customers" versus "token buybacks to stabilize token prices."
This is akin to the prolonged subsidy wars between Uber and Lyft in the ride-hailing industry around 2020, as well as the early competition between Meituan and Ele.me for riders and merchants—when product differentiation is low and user migration costs are minimal, platforms are often forced to resort to direct cash subsidies to compete for the same pool of existing users; the current Solana memecoin trading sector is in a heated phase of this competitive paradigm, with daily revenue rankings frequently switching between fomo and Pump.fun, reflecting that this niche market has yet to establish a stable monopolistic structure.
Essentially, this is a tug-of-war characterized by "capital concentration" combined with short-term "pricing power transfer"—mechanically, trading fees should be the core monetization method for platforms, but when both sides are forced to allocate a significant proportion of their revenue or financing for user and trader subsidies, the actual retained net profit margin is significantly compressed, and the overall pricing power of the industry (i.e., how much net fees platforms can charge traders) temporarily shifts from the "platform side" to the "top traders and influencers willing to arbitrage across multiple platforms"; the outcome of this subsidy war will depend on which side can first establish user stickiness sufficient to break free from cash subsidy dependence through genuine product differentiation (such as fomo's social graph and cross-asset coverage capabilities).
ABAB News · Cognitive Laws
Traffic gained through subsidies will leave as soon as the subsidies stop.
The one with more abundant financing can sustain longer in the subsidy war.
The end of homogeneous competition always leads to giving discounts to the users who are best at price comparison.