In a significant change to its business model, Pump.fun, a Solana-based token issuance launchpad, has announced that it will no longer allocate 100% of its revenue towards buying and burning its native token, PUMP. Instead, the company will split its revenue evenly between token buybacks and operational costs, including product investment, hiring, marketing, and potential acquisitions. This decision comes after a review of the previous policy, which was in place for nine months, revealed that it was not yielding the desired results.
The new strategy will see half of the company's net revenue from its core products - the Pump.fun bonding curve, PumpSwap, and Terminal - being used to buy and burn PUMP tokens on the open market, while the other half will be retained by the company to support its operations and drive growth. According to the company, this change is necessary to ensure the long-term sustainability of the business.
Over the past nine months, Pump.fun has burned approximately 36% of the circulating supply of PUMP tokens, which is one of the largest single-event supply reductions in crypto history. The company's co-founder, Alon Cohen, explained that the previous policy, although well-intentioned, was not sufficient to support the company's growth and that the new strategy will enable Pump.fun to thrive for decades to come. The price of PUMP has been trading sideways for most of 2026, despite the company's significant revenue generation, with over $1 billion in lifetime revenue.
The new strategy is expected to have a positive impact on the token's price, with some analysts arguing that the reduced supply and increased demand could lead to a bullish setup. However, others have raised concerns that the cyclical nature of memecoin launchpad volume and the declining revenue could negatively impact the token's price.