Creators' Revenue Share on pump.fun Funded by Community, Not DEX

Cryptocurrency investment firm Arca's analyst Topher recently revealed that the revenue share for creators on the platform pump.fun is actually funded by the community. According to Topher's analysis, the current fee structure of pump.fun consists of a 0.20% LP Pool fee, a 0.05% Platform Fee, and a 0.05% Creator Revenue Share. This structure indicates that the revenue remains consistent with previous levels, contrary to the claimed "50% DEX revenue kickback." Topher noted that the bonding curve, which almost accounts for all of pump.fun's revenue, would not benefit from an additional 2.5 basis points fee on DEX.

On May 13th, pump.fun announced the launch of a creator revenue share program, where 50% of PumpSwap's revenue is now shared with token creators. However, Topher's analysis suggests that this revenue share is actually funded by the community, rather than being a direct kickback from DEX revenue. This revelation raises questions about the transparency and sustainability of pump.fun's revenue-sharing model, as well as the potential impact on the platform's long-term viability.

The implications of this analysis are significant for both creators and users of the pump.fun platform. Creators may need to reassess the value of the revenue share program, while users may question the fairness of the fee structure. Additionally, the revelation could influence the broader cryptocurrency community's perception of pump.fun and similar platforms, potentially affecting their adoption and usage. As the cryptocurrency landscape continues to evolve, it is crucial for platforms to maintain transparency and fairness in their revenue-sharing models to build trust and sustainability.