Pump.fun, a Solana-based token issuance platform, has revamped its business model. Previously, the company allocated 100% of its revenue towards buying and burning its native token, PUMP.
This approach aimed to reduce the token's supply, thereby driving up its price and aligning its value with the platform's success. However, after reviewing the results of this strategy, the company has decided to adopt a new approach. Going forward, Pump.fun will split its revenue evenly between token buybacks and operational costs, including product development, hiring, marketing, and potential acquisitions. This change marks a significant shift from the previous policy, under which 100% of revenue was dedicated to token buybacks.
According to the company, the previous approach had burned approximately 36% of the token's circulating supply over the past nine months. The new strategy will see half of the revenue from Pump.fun's core products - the bonding curve, PumpSwap, and Terminal - being used to buy and burn PUMP tokens on the open market.
The other half will be retained by the company to support its ongoing operations and drive growth. Co-founder Alon Cohen explained that this change is necessary to ensure the long-term sustainability of the business, stating that the company needs to invest in its products, talent, and marketing efforts to remain competitive.
The decision to adjust the token burn strategy comes as the price of PUMP has struggled to gain traction, despite the company's significant revenue generation. In 2025, Pump.fun's gross protocol revenue totaled $971.37 million, but this figure is annualizing to around $320 million in 2026, according to DefiLlama data. While some may view this decline as a bearish sign, others argue that the reduced revenue will still result in significant token burns, which could ultimately drive up the price of PUMP.
By locking 50% of its future revenue into token buybacks, Pump.fun is committing to a long-term strategy of reducing the token's supply, which could create a bullish setup for the token. In the 24 hours following the announcement, the price of PUMP rose by 6.9%, and the token's annualized fees and revenue stand at $802 million and $416 million, respectively, as per DefiLlama.