Written by: Max Wong @IOSG

Introduction

Pump.fun launched in early 2024 as a permissionless Meme Launchpad on Solana, allowing anyone to create and trade tokens within seconds using the Bonding Curve mechanism. Initially a niche experiment, the project quickly became one of the highest revenue applications on public blockchains.

Between 2024 and 2025, Pump.fun's daily protocol revenue consistently matched or surpassed that of Hyperliquid, and the inherently cyclical nature of the Meme market makes this figure even more noteworthy. The native token $PUMP was issued at $0.004 through a $600 million ICO, with an FDV of $4 billion.

In recent months, revenue has hit record highs and token value has doubled, yet the current price of $PUMP is around $0.0019, down approximately 80% from its historic high of $0.086 (corresponding to an FDV of $8.6 billion). The current market capitalization is about $679 million, with an FDV of $1.9 billion. The gap between revenue trends and valuations is significant.

This report outlines the product evolution and ecological strategy of Pump.fun, conducts a stress test on whether its revenue is inflated, and assesses whether the current valuation reflects pricing deviation or is a reasonable discount for real risks.

Product Portfolio

Pump.fun is no longer just a Launchpad. Starting at the end of 2024, it began to expand into peripheral businesses, broadening its revenue sources and deepening control over on-chain speculative traffic.

Launchpad (Core Product)

The earliest product and the starting point of brand recognition. Anyone can deploy tokens by paying a small fee.

PumpSwap

PumpSwap is the AMM DEX built by Pump.fun, launched in March 2025, with a straightforward goal: to reclaim the graduation fees that previously flowed to Raydium (Raydium charges 6 SOL for each graduating token). After the fee update in May 2025, the protocol takes 0.05% from each transaction, with 0.20% going to LPs and 0.05% to token issuers.

Features include: creating liquidity pools for any token for free, injecting liquidity into existing pools, trading all tokens listed on PumpSwap.

Padre / Pump Terminal

After acquiring Padre, it was renamed Terminal, positioning itself as a professional trading terminal, currently supporting Solana, BNB, Base, and ETH.

Functions are similar to other terminals: Trenches (viewing newly migrated/upcoming tokens), customizable interface, sniping and instant buy, multi-wallet strategy, bundle detector.

Pumplive

Pumplive is the live streaming feature on the platform, where streamers can associate a token when creating a live broadcast.

The logic is "the publisher is the exchange," similar to the models of Parti and Kick/stake.com: streamers want to drive trading volume because they earn a share of the total fees; token holders want more trading volume and buying pressure. The more a streamer streams, the more active the token becomes, and the larger the trading volume.

Ecological Initiatives

Since TGE, Pump.fun has had about $1 billion in cash reserves, continually launching new product lines (acquiring Padre is one example), while also doing several things:

Pumpfund

The $3 million BiP (Build in Public) hackathon launched on January 19, 2026. Based on a valuation of $10 million, $250,000 is provided to 12 projects. The selection criteria favor a market-driven approach based on public attention rather than traditional VC reviews.

Glass Full Foundation

GFF is a liquidity injection program launched in August 2025. Through five transparent wallets, approximately $1.7 million (2,022 SOL) was deployed into ten tokens (including Tokabu 21.3%, House 20.6%, USDUC, NEET, MASK, FART, etc.), with a focus on projects with high community engagement.

Project Ascend

This is a creator incentive program launched in 2025, centered on dynamic tiered creator fees (0.95% to 0.05%), aiming to increase creator earnings tenfold while accelerating the CTO (community takeover) application process.

Comprehensive Metrics (All Products)

The table below summarizes the three product lines. Data for 2025 is actual, while 2026 is based on expected operating rates.

Currently, approximately 32.7% of total revenue comes from non-Launchpad products, indicating that income diversification has begun to take effect.

Currently, about 32.7% of the platform's total revenue comes from non-Launchpad products, clearly indicating that it has achieved preliminary success in diversifying revenue sources and seeking growth in other areas.

▲ Pumpfun Trading Volume Chart

▲ Pumpswap Trading Volume Chart

▲ Padre/Pump Terminal Trading Volume Chart

Is there wash trading on Pump.fun?

The apparent fundamentals of $PUMP look strong, but the core question is: does the trading volume truly reflect real economic activity, or is it artificially inflated by users and bots?

Volume Correlation Analysis

The logic is simple: in a natural market, the trading volumes of Launchpad and PumpSwap should be positively correlated and exhibit a time lag. Active Launchpad usage indicates genuine speculative interest, with funds flowing into PumpSwap through the graduation mechanism, supporting post-listing trades.

If there is significant wash trading, this relationship will break down. Launchpad trading volumes will be artificially inflated, and tokens will complete their graduations based on fabricated curve activities, entering PumpSwap without real buyers. The result will be a spike in Launchpad volume while PumpSwap volume remains flat or even declines, with correlation tending towards zero or turning negative.

The most telling signal combination is: a surge in graduation rates (more tokens artificially reaching curve thresholds), while the trading volumes of individual tokens on PumpSwap remain low and rapidly decline, and the depth of PumpSwap liquidity does not grow proportionately with the number of graduating tokens.

Data from January 2026 to present:

(The first two data points are excluded from the correlation analysis due to anomalies from PumpSwap's fee and market-making policy adjustments)

Findings:

Launchpad trading volumes are stable, fluctuating between $400 million and $570 million over eight weeks (approximately a 40% range). Considering that many bundlers and wash trading users maintain the volume baseline, this is not surprising.

PumpSwap exhibits larger fluctuations, ranging between $3.5 billion and $5.8 billion during the same period (approximately a 60% range), primarily driven by a spike in Meme trading demand in mid-January and additional incentives from the team, yet Launchpad did not see a corresponding increase in volume.

r = 0.579 indicates a moderate positive correlation. With a sample size n=8, p0.05 requires r>0.63, which does not reach the significance threshold, but the direction and intensity align with the organic growth hypothesis.

Pisa University Paper

Researchers from Pisa University conducted a comprehensive on-chain analysis of the Pump.fun Launchpad, covering all transactions of 655,770 tokens issued between September and October 2025, differentiating between bot and human trades through Solana transaction log metadata.

Four findings directly address the issue of false trading.

Large Manual Purchases are the Strongest Predictor of Graduation

The strongest predictive signal for graduation is the rapid accumulation of SOL through a small number of large transactions. The median successful graduation requires only about 457 occurrences, taking approximately 4.4 minutes from token creation to graduation. This model (large, infrequent investments from different wallets) is consistent with coordinated artificial speculation (Telegram groups pushing, KOL hype) or sequential pulling up for sales, not with high-frequency wash trading bots. In contrast, tokens driven by bots tend to accumulate many small transactions, then stagnate before graduation.

Bot Activity Actually Inhibits Graduation

After the early curve stages, tokens active with bots systematically have a lower probability of graduation. When graduation requirements were around 85 SOL accumulated on the curve, if bots were wash trading to rush for graduation, the graduation rate of bot-active tokens should be higher, but the data indicates otherwise.

The reason is structural: during graduation, the Bonding Curve transitions from virtual reserves to real AMM reserves, causing effective liquidity depth to decrease discontinuously. Selling before graduation (under the depth supported by virtual reserves) is more profitable than selling after graduation.

The study also found that the top ten token issuers in September 2025 each issued over 2,000 different tokens in a single month, with statistically anomalous sell sequences initiated by wallet clusters prior to reaching graduation thresholds. Bundlers and snipers built positions in advance, selling into the retail demand attracted by rising curves.

The paper concludes: the majority of bots on the platform are frontrunners, extracting value from human trading counterparts at entry and exit, rather than being wash traders artificially ramping up graduation thresholds. Bots accumulate large supplies through sniping/hoarding, then sell to retail investors as graduation approaches. This is distinctly different from wash trading.

SOL Net Inflow Remains Positive, Structurally Incompatible with Wash Trading

The paper calculated the net inflow of SOL in the complete dataset (the total SOL used for the curve minus the total SOL withdrawn from sales). During the observation period of a single month, the ecosystem accumulated a net retention of approximately 160,000 SOL (around $32 million at the September 2025 price).

This serves as a hard test of wash trading: circular trading volumes between associated wallets would lead to net capital flows approaching zero, as buys and sells would offset each other. The $32 million in net retention is structurally incompatible with high circular trading volumes, indicating that real external retail capital continues to flow into the Launchpad, causing a 1.25% fee loss with each trade, fueling protocol revenue.

The paper's findings align with our volume correlation analysis: the high trading volume on the Launchpad is generated by bundlers and snipers through pulling up sales, forming a volume baseline, but does not derive from wash trading. The distinction is crucial: net protocol revenue from wash trading equals zero (costs between associated wallets offset), while pulling up sales generates real fees with each transaction (from real retail trading counterparts paying the platform). The approximate $390 million ARR confirms that the platform monetizes genuine retail trading volumes through pulling up sales rather than artificially generating false metrics.

Token Economics

Repurchase

Currently, the Pump Foundation uses 100% of revenue from all product lines for open market repurchases of $PUMP. Since announcing 100% revenue repurchase on July 15, 2025, over 8 months:

27% of the circulating supply has been repurchased, clearing 9.6% of the total supply.

For comparison: Hyperliquid has only burned 4.1% of the total supply (approximately 12.3% of circulating supply) since initiating repurchase in November 2024.

Based on current prices and revenue, the annualized circulating supply liquidation ratio is approaching 45%.

Supply Structure and Unlocking

Total Supply: 1,000,000,000,000 PUMP

Circulating Supply: 430,000,000,000 (43%)

Remaining Locked: Approximately 58% of total supply

Main Unlocking Nodes: Ongoing: 12% (2% per month for community and incentives until July), July 2026: 8.25% unlocking, then 0.68% per month for 36 months.

Valuation Analysis

If the wash trading analysis holds true, $PUMP is undervalued, indicating asymmetric upside potential.

The discount arises from three aspects:

Market Doubt about Revenue Sustainability

The market perceives that Pump.fun's total platform trading volume is speculative and cyclical, bound to short-term Meme activities. Investors view the current profitability as temporary. At the current P/E ratio, repurchases have a financial enhancement effect, but the valuation model has not accounted for this, as the underlying assumption is that revenue will significantly compress. The central debate is not whether Pump.fun is profitable now, but whether it can still be profitable in 24 months.

Lack of Institutional Coverage

We interviewed 15 tier 1 secondary funds and VCs to understand their views on $PUMP. Only one of the 15 is actively tracking $PUMP using bottom-up analyses. Most institutions have not modeled the new product suite, have not broken down revenue by product line, and have not conducted stress tests on revenue sustainability.

The lack of coverage has created a narrative vacuum, with pricing primarily driven by market perceptions rather than financial analysis. In contrast, $HYPE has deeper institutional support, more research coverage, and clearer product positioning, supporting a higher and more stable valuation multiple.

There is also a self-reinforcing effect: assets related to Meme infrastructure are default categorized as speculative and transient, and trading behaviors follow suit. The market needs time and data across multiple cycles to update this cognitive framework. Until Pump's revenue withstands a broader crypto market correction and institutional coverage expands, valuation compression may continue, regardless of current cash flows.

Trust in Management has Yet to be Established

Investor concerns center around: the long-term vision beyond Meme, capital allocation discipline, execution of the product roadmap, and the transition from viral growth to a sustainable platform economy.

Markets typically assign lower valuation multiples to founder-led high-growth platforms until the platform demonstrates resilience amid market volatility, proving that growth can be converted into a sustainable platform economy. This discount is likely to persist until Pump showcases ongoing revenue diversification and robust execution through products like PumpSwap and Pump Terminal.

免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。