Solana’s leading automated market maker (AMM) Raydium responded Monday to rumors that Pump.Fun, a key volume contributor, is preparing to debut its own AMM.

“Abandoning Raydium completely would be a strategic miscalculation,” stated core contributor InfraRAY in a post on platform X, expressing skepticism about Pump.Fun’s ability to replicate its current success should it replace Raydium with in-house infrastructure.

Investors sold off RAY tokens heavily this weekend following indications that Pump.Fun might be testing its own AMM to potentially take over Raydium’s historic liquidity pools. This transition could significantly alter the dynamics of decentralized trading on Solana.

Currently, Raydium, the primary AMM platform, benefits from trading fees generated by tokens transitioning from Pump.Fun’s launchpad to its own liquidity pools. This collaboration has provided considerable financial advantages for Raydium.

Conversely, Pump.Fun does not gain from the long-term potential of its generated tokens, though it has acquired significant earnings—around half a billion dollars—by collecting fees from initial token launches.

Raydium is making over $1 million daily from trading across all its liquidity pools, with more than 30% of this volume originating from Pump.Fun tokens, as indicated by a Dune dashboard. Thus, a switch away from Raydium could notably reduce its fee income.

“The potential revenue loss is very real,” InfraRAY noted to CoinDesk, suggesting that the market’s reaction to RAY tokens may be exaggerated, influenced partly by the overall market conditions for SOL.

He further warned that a pivot to a new AMM could face numerous challenges, including lack of adequate infrastructure, diminished demand for transitioned tokens, and potential underperformance in trading volume at launch.

“I think these are genuine risks they are overlooking, though I also could be mistaken,” InfraRAY added.

Pump.Fun co-founder Alon Cohen has chosen not to comment.