Pump.fun Shifts Strategy: Revenue to be Split Between Token Buybacks and Operations

Pump.fun, a Solana-based token issuance platform, has been operating under a model where every dollar of revenue was used to buy back and burn its native token, PUMP. This approach, aimed at reducing the token's supply and boosting its price, has been in place for nine months.

However, the company has now decided to alter this strategy, citing a need to allocate resources more effectively. 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 comes after the company burned approximately 36% of PUMP's circulating supply, which it had acquired through buybacks over the past nine months. The new 50/50 revenue split will see half of the revenue from Pump.fun's core products - the bonding curve, PumpSwap, and Terminal - being used for token buybacks, while the other half will be retained by the company for operational purposes.

This strategic shift is intended to ensure the long-term sustainability of the platform, according to co-founder Alon Cohen. Despite the previous policy of allocating 100% of revenue to token buybacks, PUMP's price has largely traded sideways below its launch valuation, prompting the need for a revised approach. The change in strategy has been prompted by the need for the company to invest in its products, hire new talent, and explore potential acquisitions to drive growth and stay competitive. The price chart for PUMP has been a key factor in this decision, with the token spending most of 2026 trading below its launch valuation.

The new strategy is expected to have both positive and negative implications for the token's price. On one hand, the reduced revenue allocated to token buybacks may lead to smaller burns, potentially putting downward pressure on the price.

On the other hand, the ongoing burns, combined with the reduced supply of tokens, could create a bullish setup for the token, particularly if demand remains steady. In the 24 hours following the announcement, PUMP's price rose by 6.9%, with the token's annualized fees and revenue standing at $802 million and $416 million, respectively, according to DefiLlama.