Questions Behind Pump.fun's Coin Issuance Carnival: Exit or Catch a Falling Knife?

Recently, the most关注的 Token Generation Event (TGE) in the cryptocurrency market is undoubtedly the代币发行 of Pump.fun. This event has been brewing since June, continuously fermenting amidst various expectations and doubts, until it finally landed on July 12th. Although there are many doubts about its $4 billion valuation, the actual data shows that investor enthusiasm remains high. The public offering was sold out in just 12 minutes, and some investors expressed their dissatisfaction on social media for not being able to participate.

So far, Pump.fun has delivered a relatively satisfactory answer. After launching, the token price has steadily increased, and today it achieved its first buyback. However, whether the coin price can be maintained in the long term remains a question in many people's minds.

As a standout application in this round of the bull market, the success of Pump.fun is indisputable. It has completely transformed the traditional token issuance model and significantly lowered the threshold. With just $3, you can create a coin, and this enticing mechanism still holds strong appeal even as the MEME craze cools down.

From a mechanism design perspective, Pump.fun adopts a fully automated smart contract pricing model, with no pre-sales or private placements, and even sets up an automatic "graduation" mechanism. When the market value of the coin reaches $69,000, the system automatically creates a liquidity pool on decentralized exchanges, achieving a fully automated process for listing coins, which is very popular in the market. This also makes Pump.fun one of the strongest "money printers" in this market cycle.

Since its launch in January 2024, Pump.fun's performance has been impressive. The total number of issued tokens has reached 11.44 million, with over 22 million active addresses, and cumulative revenue approaching 720 million USD. At its peak, daily fee revenue soared to 5.43 million USD, with total daily income exceeding 15.88 million USD. It can be said that the bonuses of this round of the MEME market have almost all been absorbed by Pump.fun, further promoting the development of the Solana ecosystem.

However, such a project that started with MEME suddenly announced to issue coin, triggering widespread discussion in the market. Rumors had already emerged in February this year that Pump.fun planned to issue coin on centralized exchanges, but it was shelved due to unfavorable market conditions. In June, the rumors of issuing coin resurfaced. According to multiple sources, Pump.fun plans to raise $1 billion through token sales, with a valuation of up to $4 billion.

On July 10th, Pump.fun officially announced that it will launch the public offering of its native token PUMP on July 12th, along with an airdrop. This sale will issue 150 billion tokens at a unit price of 0.004 USDT, accounting for 15% of the total supply. Based on a valuation of 4 billion US dollars, this round of financing amounts to 600 million US dollars. It is worth noting that, for compliance reasons, users from the UK and the US are excluded from this sale.

In the token allocation plan, 33% is used for public sale, 24% is for community and ecosystem incentives, 20% is allocated to the team, 2.4% is for the ecosystem fund, 2% belongs to the foundation, 13% is distributed to existing investors, 3% is for live broadcast related activities, and 2.6% is for liquidity and exchange support.

However, compared to the previous high expectations, when it actually came time to issue coin, the market instead showed a collective pessimism. The controversy mainly centered around the $4 billion valuation. It should be noted that Circle, a stablecoin giant recently listed on the New York Stock Exchange, has a valuation of only $7 billion. The fact that an on-chain gambling platform is seeking a $4 billion valuation, which even surpasses that of most DeFi blue-chip projects, raises doubts in the market about whether it is overextending its future growth potential.

Moreover, the current market environment has undergone significant changes. Looking at the entire cryptocurrency market, aside from a slight rebound in the past few days, the performance of most altcoins and MEME coins has been quite sluggish. This is clearly reflected in the trading volume data. According to statistics from Dune, the trading volume of Pump.fun peaked at $5.44 million on January 23, 2025, and has since shown a cliff-like decline. Recent daily trading volumes have stabilized at under $700,000, a drop of as much as 87.2% from the peak. In terms of the number of tokens created, the daily new additions have fallen from a high of 70,000 to around 30,000, almost halving. The "graduation rate" of tokens is even more astonishing, dropping from a high of 1.6% in 2024 to now below 1%. These data clearly indicate that the enthusiasm in the MEME market is rapidly fading, and user participation is also quickly diminishing.

Although the influence of Pump.fun cannot be underestimated, it is ultimately just a tool platform, and its success largely depends on the prosperity of the entire MEME market. This is also one of the important reasons why the market questions its high valuation.

On the other hand, although the overall market is shrinking, competitors are constantly rising. Pump.fun, which once stood alone in the world, is now facing considerable pressure. The competitor letsbonk.fun, centered around BONK, has developed rapidly, surpassing Pump.fun multiple times in the number of tokens issued and briefly becoming the market leader. Although Pump.fun quickly counterattacked, the competition between the two remains intense, and Pump.fun's leading position is facing unprecedented challenges.

It is precisely under the combined effect of these factors that Pump.fun's $4 billion valuation has come under severe scrutiny. As soon as the rumors of issuing coins in June emerged, it immediately triggered a risk-averse sentiment in the market, causing popular MEME coins in the Solana ecosystem to experience significant pullbacks, with funds quickly flowing out. Some industry insiders even stated that this ICO seems more like an exit cash-out rather than a long-term development plan. Additionally, crypto analysts pointed out that Pump.fun may be staging a thorough "harvesting operation."

Ironically, in March 2024, a co-founder of Pump.fun publicly stated that every presale is a scam. Now, Pump.fun has chosen the presale format to issue coins, which makes one exclaim how unpredictable the world is. This coin issuance raised 33% of the total supply, with 18% allocated to the private placement round for institutions and 15% for the public offering round, with all coins fully unlocked on the first day of listing.

Despite the cautious attitude within the industry regarding this issuance of coins, the enthusiasm among supporters and institutional investors has unexpectedly surged. The public offering completed a quota of 500 million USD in just 12 minutes, with six major trading platforms, including several well-known exchanges, participating in the public offering of PUMP. According to statistics, there were 23,959 unique wallet addresses that participated in the pre-sale on the Pump.fun official website and completed KYC, with 10,145 addresses successfully buying in, averaging a subscription amount of 44,209 USD. Notably, 89.7% of PUMP token pre-sales were conducted through the official website, while the total amount sold on exchanges accounted for only 10.3%. In the official pre-sale, small users dominated, with 5,758 users having subscription amounts under 1,000 USD, while the number of addresses with subscription amounts exceeding 1 million USD was 202, indicating strong interest from institutional investors.

This process perfectly illustrates the unique phenomenon of "verbal discontent but physical compliance" in the cryptocurrency market. Due to technical failures in some exchanges during the public sale process, some users were unable to complete their subscriptions, leading to dissatisfaction on social media. Regarding the subsequent performance of PUMP, there has been significant disagreement within the community. One faction believes that the valuation is too high and will inevitably collapse once the spotlight effect fades; the other faction believes that Pump, as the most representative product in the MEME space, has a complete income logic and user recognition foundation, and will not easily fall from grace.

From the current situation, the latter viewpoint seems to be temporarily prevailing. After PUMP was launched on July 15, although it briefly fell from $0.0065 to $0.0042, it quickly stabilized and rebounded, starting to rise. The current price is $0.0066, an increase of 55% from the fundraising price of $0.004, and the market capitalization has risen from $4 billion to $6.6 billion, bringing considerable returns to the subscribers.

Of course, there are certain operational factors behind this part of the price increase. According to on-chain data analysis, Pump.fun started to use the fee income to buy back PUMP after issuing the coin. In just 7 hours, the project team transferred 187,770 SOL of fee income to a specific address to purchase PUMP, and then transferred the purchased tokens to another address for storage. Currently, 111,953 SOL(, equivalent to about 1.83 million USD), has been used to buy 3.04 billion PUMP at an average price of 0.006 USD. Although this buyback behavior can support the price, it inevitably gives the impression of transferring from one hand to the other. However, for token holders, as long as the price can be raised, it is good news regardless of the purpose.

Whether for cashing out or simply for continued development, the controversy surrounding the valuation of Pump.fun precisely reflects the current state of the market. The MEME sector, once notable for its liquidity, is now collectively in trouble, and the once-hot attention economy seems to have gradually become a false proposition. Today, even the most representative applications have no choice but to embark on the path of issuing coin, which may signal the end of an era. The future direction of the MEME field will heavily rely on the performance of the PUMP token as an important barometer. The market's bets on it are essentially a comprehensive test of the value of the attention economy. If the token can continue to rise, it at least indicates that the market recognizes its pricing; conversely, if the token crashes, people will have to rethink the inherent value of the MEME market, which could trigger more selling sentiment. This may also be one of the reasons why Pump.fun chose to repurchase.

Returning to the title question: who is the biggest winner of Pump.fun's coin issuance? Undoubtedly, the project party is the biggest beneficiary. Participants in both public and private offerings also seem to be making a fortune, and short-term investors are similarly reaping substantial profits. But how long can this situation last? At what level can the project party maintain the coin price? These are all unresolved major issues. There are signs that some big players have already started to cash in. According to monitoring, a certain whale spent 5 million USDC through 5 wallets to participate in the PUMP public sale, purchasing 1.25 billion PUMP, which has now all been sold at an average price of $0.0067, netting a profit of $3.416 million.

On the other hand, returning to the current macro environment, the overall positive trend of the market will also affect the MEME sector to a certain extent. The strong performance of Ethereum has driven the continuous rise of mainstream tokens, which has directly promoted the explosion of quality projects in the Ethereum ecosystem. Taking ENS as an example, today’s increase exceeded 18%, reaching a new high since February of this year. In the long term, although there are still some uncertainties in the current market, the foreseeable interest rate cut cycle is already on the way, and the altcoin market is expected to welcome a small wave of upsurge. The MEME sector may show a polarization trend: quality projects benefit from sector rotation and rise, while other projects may fall into neglect due to the withdrawal of liquidity.

Following this development path, although MEME, as a form of economic existence similar to the lipstick economy or lottery economy, will never disappear, it will be difficult to create waves in the market like those in 2024.

![Behind the Pump.fun coin issuance frenzy: Who is retreating? Who is catching a falling knife?](