With the news of Pump.fun issuing tokens once again circulating, the already fragile liquidity defense line on the Solana chain has been breached, tearing apart the market confidence that was still in recovery, and on-chain risk aversion sentiment has rapidly intensified.
Written by: Nancy, PANews
With the news of Pump.fun issuing tokens once again circulating, the already fragile liquidity defense line on the Solana chain has been breached, tearing apart the market confidence that was still in recovery, and on-chain risk aversion sentiment has rapidly intensified.
On-chain "slot machines," only 3.6% of users profit over $500
Recently, rumors surrounding Pump.fun's upcoming token issuance have stirred the market once again. According to multiple insiders cited by Blockworks, Pump.fun plans to raise $1 billion through a token sale, with a valuation of $4 billion, and the tokens will be sold to both the public and private investors. Although the official release date has not been confirmed, the platform's social media accounts hint that it may go live within two weeks.
In fact, this is not the first time news of a token issuance has surfaced. As early as February this year, Wu said Blockchain reported that Pump.fun planned to issue tokens through a Dutch auction within a centralized exchange (CEX) and provided detailed token issuance preparation documents to the CEX. However, at that time, market liquidity was significantly drained by the personal MEME coin issued by Trump and his wife Melania, and the plan ultimately did not materialize. Now, with the market environment slightly warming, Pump.fun's token issuance plan seems to be back on the agenda.
However, this on-chain "printing machine" is facing a significant decline in market enthusiasm.
According to Dune data, as of June 4, the platform's cumulative revenue has surpassed $730 million, with a single-day revenue peak approaching $15 million. However, since February 2025, the platform's revenue growth has significantly slowed, with most daily revenues currently stabilizing in the millions.
In terms of trading volume, Pump.fun set a historical record of $3.3 billion in a single week at the end of 2024, and although there have been several rebounds to the $1 billion level, it has struggled to return to its peak. The trend of weakening liquidity has somewhat diminished the platform's popularity and user participation willingness.
From the perspective of token creation volume, Pump.fun has created over 11.02 million tokens to date, with a single-day token creation peak reaching 70,000 (in January 2025). However, this figure has now dropped to an average of around 30,000 per day, indicating a cooling of user participation enthusiasm.
It is worth noting that behind the vast number of MEME coins, there are very few projects with a certain market value. According to Dune statistics, currently, only 14 tokens have a market value exceeding $50 million, and only 259 tokens have a market value between $1 million and $50 million, while approximately 14,000 tokens are in the micro-market cap stage. This indicates that the vast majority of tokens remain in a self-indulgent phase, lacking the ability to attract external funding.
On the user level, Pump.fun is also facing a cliff in new traffic, with old users struggling to hold on. Dune data shows that Pump.fun reached its peak at the end of January 2025, with the number of active wallets exceeding 400,000 in a single day, driven by a surge of new users. However, as market sentiment cooled, the number of active wallets declined, and the platform's activity mainly relied on the reuse of old users, with new user contributions significantly dropping. This trend also corroborates that many Pump.fun users frequently attempt to create and speculate on MEME coins, but very few projects can establish sustainable value, leading to short user cycles and weak retention.
Moreover, behind the narrative of wealth accumulation through Pump.fun lies a stark survivor bias. Dune data shows that the number of wallets participating in trading this month is approximately 594,000, with only 3.6% of users achieving substantial profits exceeding $500. Even more astonishingly, only 27 wallets made profits exceeding $100,000, accounting for just 0.0045% of total traders; while the number of wallets achieving profits over $10,000 is 577, making up only 0.1%. In contrast, the loss ratio is even higher, reaching 52.5%, with extreme cases of losses in the million-dollar range. These data clearly indicate that a very small number of speculators have pocketed the vast majority of profits, while the vast majority of retail investors merely serve as liquidity fuel.
At a time when user growth has peaked, token quality is concerning, and liquidity is overdrawn, whether Pump.fun's token issuance can stir market sentiment and support a valuation of $4 billion is highly uncertain.
Solana's risk aversion sentiment intensifies, high valuation token issuance sparks controversy
The news of Pump.fun's high valuation token issuance has raised concerns among many investors about whether it will repeat the last wave of frenzy seen during the launch of APE coin.
"The last king-level project with a $4 billion valuation was APE's Yuga Labs, which was touted as the last wave of brilliance during the bull market, after which the market's clones all halved. Now Pump.fun also has a $4 billion valuation, but the fundraising amount is more than double that of APE's back then. In recent days, various exchanges have accelerated the frequency of token listings, likely to intentionally avoid the major bloodsucking event of PUMP in two weeks," crypto KOL @AB stated.
From the perspective of capital flow on the Solana chain, risk aversion sentiment is rising, and MEME coins are collectively declining. According to CoinGecko data, in the past 24 hours, popular MEME coins in the Solana ecosystem have generally experienced varying degrees of pullback. Meanwhile, Artemis data shows that Solana has become the third highest blockchain network for net capital outflow in the past 24 hours.
Independent researcher @Haotian bluntly pointed out that Pump.fun's current valuation level is "extremely inflated," with a valuation of a MEME launch platform surpassing most DeFi blue-chip protocols, and raised the following four core criticisms: (1) The inflated market valuation is quite unreasonable: Pump.fun's attention economy business relies on the short-term irrational product of FOMO in the MEME coin market. In simple terms, it is driven by "gambling" to monetize traffic. This means that Pump.fun's business model's monetization ability is entirely a product of the short-term spotlight effect of the market, rather than a sustainable profit logic; (2) A weak business moat is easily surpassed: Pump.fun has seized the technological dividends of Solana's high performance and low cost, as well as the era dividend of MEME culture moving from niche to mainstream. This business model, built on others' infrastructure, is essentially a "dependent" business. Once there are significant changes in the Solana ecosystem, the fragility of its business model will be fully exposed; (3) The tool-like nature of the Launchpad is difficult to form an ecosystem: Currently, even if it is "profitable," it is merely a "token issuance tool." The paradox exists in transforming from a pure Launchpad to a complex MEME economic ecosystem: the core of MEME culture is precisely simplicity, directness, and viral spread; excessive functional layering will only cause the platform to lose its original "wildness"; (4) The extremely high valuation will disrupt the original value innovation system: Pump.fun's extremely high valuation sends a dangerous signal to the entire industry: in the current Crypto ecosystem, the value of "traffic aggregation + speculative monetization" may surpass "technological innovation + infrastructure." He believes the key lies in whether Pump.fun can truly build a sustainable business moat after obtaining massive capital; otherwise, this distorted valuation will bring tremendous innovative disasters to the entire industry, heralding a more utilitarian, shortsighted, and further away from the technical geek essence of Crypto future.
KOL @xingpt added from a valuation perspective that Pump.fun's annualized revenue over the past 30 days is $77.98 million, corresponding to an FDV of $5 billion, resulting in an FDV/annualized revenue ratio of 64; which is relatively high. If viewed from a long-term perspective, Pump is certainly not worth this valuation, as its revenue certainty is not as strong as DeFi leaders like Ray/Cake; but if the market is good, the team may create FOMO, and it could potentially double. Given the current valuation and the sentiment on X, I feel there is no need to be overly bearish or even short at the opening. Holding cash and watching the changes is sufficient.
However, crypto KOL @加密韋馱 stated that discussing merits and faults without considering historical context is disingenuous. The reason Solana has its current position as a main battlefield on-chain is directly due to Pump.fun, which solved the liquidity solution from zero liquidity to AMM to CEX, standardizing on-chain security (withdrawal pools, contract hiding), building a PVP on-chain culture, and forming a substantial amount of SOL locked up. The emergence of Pump.fun is akin to the iPhone moment on-chain, as it is the first to recognize that the attention span of the younger generation is extremely short and that they disdain traditional values, preferring PVP. From a value investment perspective, Pump is the largest consumer application in the network, yet its price-to-earnings ratio is only 5, making it a true value investment target. He believes that currently, there are only two moats in the crypto space: liquidity and screen time.
"Stop fantasizing that Pump.fun will issue airdrops." In response to the market's fantasies about Pump.fun's airdrops, Weirdo Ghost Gang founder sleepy pointed out that Pump.fun has already completed its cold start through its product and has no motivation to issue airdrops. In fact, airdrops have increasingly become a tool for capturing short-term attention. While they seem to "incentivize users," they rarely manage to retain loyal users. Airdrops ≠ user loyalty. Airdrops are merely a traffic release mechanism used to amplify a project's influence in a short time. However, Pump.fun already has a stable and large user base, and it does not need to use airdrops to supplement its attention or create topics.
In summary, while the news of Pump.fun's token issuance has reignited heated discussions in the market, hidden behind this enthusiasm are the structural fragility of market liquidity, the retreat of user participation sentiment, and the enormous bubble of the MEME narrative.
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