Pump.fun ICO Sells Out in 12 Minutes Despite 92% Revenue Drop

Pump.fun, a Solana-based crypto launchpad, has been a significant contributor to the memecoin craze. Despite a 92% drop in revenue from its peak of $7 million, the platform's recent Initial Coin Offering (ICO) sold out all tokens in just 12 minutes, despite warnings from the media. The ICO, initially planned as a three-day event, was met with immense hype and speculation, raising questions about the sustainability and legitimacy of such ventures.

The term ICO has historically been associated with market manipulation and the creation of worthless altcoins, particularly during the 2017 crypto boom. While some observers suggest that ICOs are making a comeback, others view them as a bubble similar to the current Bitcoin treasury companies boom. The announcement of an ICO by one of the biggest cryptocurrency startups of 2024, Pump.fun, added to the intrigue, given the platform's eccentric marketing style and the controversial statements made by its frontman, Alon Cohen.

In July 2024, Cohen tweeted about a "One last exit pump," which was later interpreted as the launch of the $PUMP token. However, in February, Cohen had denied any plans for a token, advising followers not to listen to rumors. The ICO was officially announced on July 9, with ambitious claims to "kill Facebook, TikTok, and Twitch. On Solana." The announcement included a video clip depicting a woman giving a man a Pump.fun pill, leading him to a world of content creation and memecoin trading, with the woman concluding that these projects could "change your life… maybe even the world."

The ICO structure revealed that 33% of the one trillion $PUMP tokens would be sold through the ICO, with 18% allocated in a private sale and 15% in a public sale. The remaining tokens were reserved for various purposes, including community initiatives, the team, existing investors, and the ecosystem fund. Scott Melker of The Wolf of All Streets podcast translated this structure, highlighting the significant portion allocated to insiders and the potential risks for normal investors due to the 48-72 hour delay in token transferability.

Community members expressed concerns about the lack of airdrops and the transparency of exchange listings. Cohen had previously stated that exchange listings were dead and that everything important happens on-chain. The announcement thread emphasized Pump.fun's growth last year but ignored the substantial drop in revenues and the platform's lagging 24-hour volume compared to its competitor, Let’s Bonk. The ambitious plans to overtake major entertainment media platforms were not backed by any explanation of how this would be achieved.

Pump.fun has had its share of positive moments, such as raising funds for a girl with a brain tumor through a charity token. However, the platform has also been marred by dark and disturbing content on its livestreams. Crypto streamers have resorted to increasingly shocking tactics to grab attention and boost token prices, including self-harm, explicit sex shows, and threats of violence. These incidents have raised serious concerns about the ethical implications and the impact on the broader crypto ecosystem.

The future of Pump.fun and its native token launch remains uncertain. It is yet to be seen whether this launch will mark a new chapter for the platform or if it will be the "one big exit pump" that some have speculated about. The hype and controversy surrounding the ICO highlight the complex and often troubling nature of the crypto world, where innovation and speculation often go hand in hand with significant risks and ethical dilemmas.