Pump Fun: The launch of PUMP, the ultimate extract or a new beginning?

Background on Pump Fun

Launched at the beginning of 2024, Pump Fun has become a cornerstone of the Solana ecosystem. This permissionless launchpad has enabled the creation of thousands of tokens, contributing to the phenomenal success of the memecoin narrative and serving as one of the main retail onboarding channels in crypto.

Pump Fun’s success can be explained mainly by its operational simplicity: a super accessible interface, a token creation process that takes just a few clicks, and a bonding curve system that doesn’t require any liquidity from memecoin creators.

As a result, creating tokens on Pump Fun takes just a few seconds and costs almost nothing. For the first tens of thousands of dollars in market cap, buys and sells are based on a virtual exchange. Once the token surpasses a certain capitalization threshold, Pump Fun officially deploys it on a DEX and provides the necessary liquidity.

In the end, Pump Fun is more than a token launchpad: it’s a market maker, a decentralized exchange, and above all, the very symbol of the memecoin narrative.

Pump Fun’s ICO comes at a time when the project is looking to diversify its activities:

• Launch of v2.0, with an improved mobile interface;
• Acquisition of Kolscan, a tool for tracking influencer wallets and copying their trades;
• Rollout of several features like livestreaming and chat.

Pump Fun has also announced its ambition to become a social network, natively integrating tokens into its platform and aiming to compete directly with industry giants.

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Key Activity Metrics

In less than two years, Pump Fun has generated nearly $800 million in revenue. The two main sources of income are the fees on the bonding curve (1% per swap), and more recently, the fees on PumpSwap (0.3% per swap), Pump Fun’s native DEX.

The memecoin mania was one of 2024’s major narratives, reaching a historic peak of euphoria in January with the launch of Donald Trump’s token. Since then, activity and investor interest have both sharply declined.

Despite this, Pump Fun’s performance metrics have remained remarkably resilient:

• Revenue remains at around $50 million per month, making Pump Fun one of the industry’s most profitable protocols.
• The number of daily active addresses is around 330,000, just a 17% drop from the all-time high in January.

Several factors help explain this sustained activity. First and foremost, the launch of PumpSwap in May 2025, a DEX competing with Raydium, where memecoins are automatically deployed after completing their bonding curve.

PumpSwap is a masterstroke for Pump Fun, as it allows the protocol to control the entire lifecycle of a memecoin, from creation to daily trading by investors. In less than two months, PumpSwap has generated around $15 billion in volume, with a 0.05% fee going to Pump Fun.

Secondly, rumors of a PUMP token airdrop to users of Pump Fun and PumpSwap continue to circulate. It’s hard to say whether this is just a mirage hiding an activity desert to come, but one thing is clear: Pump Fun has managed to maintain massive user engagement.

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Pump Fun vs. the Competition

Pump Fun’s meteoric rise has naturally attracted new competitors in the Solana memecoin launchpad sector. Notable challengers include Moonshot, Launchlab (developed by the Raydium DEX), and Let’s Bonk.

Competition has intensified in recent weeks: both Launchlab and Let’s Bonk have managed to generate daily fee volumes comparable to Pump Fun (between $900,000 and $1.3 million per day).

However, while each project has had its moment of hype, none have managed to unseat Pump Fun in terms of traction and adoption. This increase in competition is still relatively recent, and when you look at the metrics, Pump Fun remains the undisputed leader in the sector, with over 330,000 daily active addresses and far ahead of its immediate rivals.

Pump Fun still enjoys its pioneer status, a first mover advantage that has allowed it to build a large, loyal user base. The only real question that remains is the true intent of the team behind Pump Fun.

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A Controversial Team

It’s true that Pump Fun is now one of the most profitable and widely used applications in the crypto ecosystem. However, the project’s team has an extremely controversial reputation.

Since its inception, Pump Fun has been criticized for being too “extractive”: nearly $800 million in cumulative revenues, zero redistribution to the community or the Solana ecosystem, and a $1.3 billion raise whose purpose remains vague.

This is accompanied by an ambivalent view of memecoins themselves. While some believe Pump Fun is the best answer to retail’s appetite for speculation and entertainment, others point to the lack of “real value” contributed to the industry.

Nevertheless, Pump Fun’s success is undeniable, and the reality is much more nuanced than this debate suggests. The project has perfectly captured and channeled the speculative demand of a massive part of the market, achieving a rarely seen product-market fit.

The launch of PUMP therefore marks a strategic turning point for Pump Fun. The team now has the opportunity to redistribute a share of revenue to the ecosystem, rewarding historic users via an airdrop, but above all, finally aligning its interests with those of holders through a revenue-sharing mechanism.

But the central question remains: does the team truly wish to transform this dynamic into lasting legitimacy, or is this the final stage of a massive extraction project?

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Analysis of the PUMP ICO

PUMP Tokenomics

At launch, the PUMP token will not have any particular utility. However, the team plans to rapidly add several features: fee discounts, buybacks funded by protocol revenues, and various incentive mechanisms.

This lack of clarity feeds genuine uncertainty. If a buyback program were to materialize, it could generate hundreds of millions of dollars in buying pressure on the token.

The token’s distribution has also drawn sharp criticism from investors. Of the 33% allocated to the ICO, only 12.5% were actually sold in the public phase, with the remainder going to private investors beforehand.

The share of tokens reserved for the community represents about a quarter of the total supply. According to some rumors, about 10% could be earmarked for an airdrop that, while not officially announced, is said by Polymarket to have an 89% chance of occurring before August 31, 2025.

Where Pump Fun stands out is in its vesting schedule. More than half of the PUMP tokens will be immediately liquid at launch, while the founding team and initial investors will face a one-year cliff.

ICO Process

The public phase of the ICO took place directly on the Pump Fun interface, as well as via six CEX partners (Bybit, Bitget, Kraken, Gate, KuCoin, and MEXC). The introductory price was set at $0.004 per PUMP token, for a fully diluted valuation (FDV) of $4 billion, with terms equivalent to those for institutional investors (tokens unlocked at TGE).

According to figures provided by Pump Fun, the 125 billion PUMP tokens on offer (about $500 million) sold out in 12 minutes. Despite the scale of the funds raised, this lightning sale demonstrates the extremely high demand for the token during the ICO. The result surprised many observers, especially given surveys showing that most investors didn’t intend to participate.

Onchain data confirm this trend: only around 10,000 wallets managed to access the sale, with whales capturing most of the tokens.

It’s also worth noting that many investors weren’t able to participate. Several factors explain this: the need for KYC, restrictions for UK and US citizens, and technical problems on some CEX interfaces (failed APIs, impossible deposits).

Demand around the ICO was so high that the token’s virtual FDV briefly hit $6.5 billion on the HyperLiquid premarket. This momentum hasn’t faded: at the time of writing, perpetuals are trading around a $6.2 billion FDV, over 50% above the ICO price.

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Outlook and Potential for the PUMP Token

An Anticipated Listing

The launch of the PUMP token is scheduled for 48 to 72 hours after the ICO, meaning today or tomorrow. Expectations around the listing are especially high: on premarkets like HyperLiquid, the fully diluted value (FDV) is already above $6 billion, far above the ICO price ($4 billion), reflecting clear speculative anticipation. According to Polymarket, there is now a greater than 50% chance that PUMP ends its first day of trading with an FDV above this level.

In the short term, several factors could fuel this momentum:

• The effective token supply is highly concentrated, with most investors unable to participate in the ICO;
• The project continues to generate over $500 million in annual revenue, which, based on DeFi multiples, justifies a high valuation as long as profitability is maintained;
• The potential announcement of an airdrop for historic users, which could further boost community engagement and support secondary demand.

Nevertheless, the medium- and long-term trajectory for the token remains subject to several major uncertainties, relating to the team’s reputation, their real ambitions for the project, the potential for revenue sharing, and Pump Fun’s ability to expand its scope beyond the memecoin narrative alone.

Key Valuation Insights for PUMP

Valuing the PUMP token is a tricky exercise, as the memecoin industry is still quite atypical. However, our partners at GLC Research have developed a solid analytical framework to assess both the potential (and the limitations) of PUMP’s launch valuation.

Their approach is based on several key figures and market assumptions:

• Current revenue: Pump Fun generates around $500 million per year, with a solid track record even in quieter market periods.
• Available cash: The protocol reportedly holds close to $1 billion in treasury, a powerful lever for innovation or potential strategic acquisitions.
• Distribution: Up to 75% of the token supply could be used for community incentives or airdrops, mechanically limiting short-term sell pressure.
• Valuation/revenue ratio: At a $4–6 billion FDV, this implies a P/E of 8 to 12—still reasonable given the protocol’s profitability and the sector’s outlook.
• Growth scenarios: The GLC thesis relies on growing AMM revenues (PumpSwap), maintaining the competitive moat through brand strength, and the ability to verticalize the model via new acquisitions (trading bots, analytics, etc.).

In the current context, PUMP’s launch valuation appears broadly justified, with limited downside risk outside of an “extreme bear market” scenario. The main shadow still hanging over the project is whether the team can maintain activity and implement a credible value-sharing mechanism with users and holders.

For all the numbers, assumptions, and conclusions from GLC Research, you can read their full article:

In any case, PUMP is one of the most significant launches of 2025. Whether or not you decide to get exposure, this is a major event: there’s likely a lot to learn, and it would be a shame not to follow it closely.