Pump.fun Buys $42 million in PUMP Tokens Despite Revenue Drop

21 hours ago

Pump.fun Buys $42 million in PUMP Tokens Despite Revenue Drop — Image source: Unblock Media

Repurchases $42.38 million in PUMP tokens since its June airdrop.
Buys back tokens at a 40% premium despite falling daily revenue.

On August 13, 2024, The Block reported that Solana memecoin launchpad Pump.fun has repurchased $42.38 million of its native PUMP token. The aggressive buyback program, which includes significant repurchases since June, follows an exploit in May that resulted in the introduction of the token.

Pump.fun conducted the buybacks at an average price of $0.0058, approximately 40% higher than PUMP’s current spot price of $0.0041. However, despite the platform paying this premium, the token's value has fallen 42% since its mid-June peak. The buyback program is funded by fees collected from the platform's memecoin launchpad activities.

On August 12, Pump.fun executed one of its largest single-day buybacks, purchasing $11.65 million in PUMP tokens. According to data from Dune Analytics, the cumulative repurchase amount has reached approximately 7.3 billion PUMP tokens, highlighting the program's scale. However, other on-chain data trackers like Lookonchain report different total buyback figures, suggesting some variation in aggregated numbers.

The buyback initiative comes amid shrinking platform revenues and intensifying competition from rival launchpads. In late June, BONKswap, a competing Solana-based launchpad, briefly overtook Pump.fun in daily trading volume. Despite these challenges, Pump.fun has since reclaimed its position as the leading Solana memecoin launchpad, though its overall user engagement has been inconsistent.

Although Pump.fun introduced new features and conducted its recent airdrop to spur adoption, the platform's daily revenue has trended downward since its May peaks. This decline raises concerns about the sustainability of its buyback strategy in a competitive and turbulent market.

As of August 13 at 15:00 UTC, Pump.fun (PUMP) was trading at $0.0041. According to market data, its 24-hour trading volume had increased by 4.5%.