Pump.fun Plans 1 Billion ICO, Revenue Share for PUMP Token Holders

Pump.fun, a Solana-based memecoin platform, is reportedly considering a plan to distribute a portion of its protocol revenue to holders of the PUMP token. This initiative is part of the platform's broader strategy to share its financial success with its community of token holders. The move comes as Pump.fun aims to raise $1 billion through an initial coin offering (ICO), which would value the platform at $4 billion. This significant valuation underscores the platform's ability to generate substantial revenue, with sources indicating that Pump.fun has accumulated nearly $700 million in cumulative revenue since its launch in early 2024.

The specifics of how much revenue will be directed to PUMP token holders remain unclear. The platform is exploring a "buyback-powered utility structure," which could potentially include revenues generated from PumpSwap, the decentralized exchange launched earlier this year. However, Pump.fun has not responded to multiple requests for comment, leaving many details uncertain. One source close to the founding team mentioned that the plan involves tying a portion of Pump revenue to a buyback mechanism, with tokens expected to unlock at the token generation event (TGE) for participants in the sale, whether private or public.

Pump.fun first hinted at a token launch last October, when a co-founder mentioned during an event that the company was planning to launch a token to reward its earliest users. The PUMP token, which will be sold to both public and private investors, is expected to be fully unlocked at the TGE. There may be additional token issuances, but the total supply is expected to be capped at 1 trillion tokens. The team is currently pitching private investors at $0.004 per token, with a public sale planned within two weeks. Part of the sale will reportedly take place on exchanges, and an airdrop is expected. Approximately 25% of the token supply will go to the public sale, with another 10% reserved for the airdrop.

The platform's decision to distribute protocol revenue to PUMP token holders is seen as a way to reward its loyal community and encourage further engagement. This move comes at a time when Pump.fun is credited with helping to revive the Solana ecosystem, which faced challenges following the collapse of major SOL backer. The potential ICO has boosted recent user activity on Pump, which had seen a significant decline since the start of the year. The percentage of "graduated" tokens—those that see enough market activity to move onto an affiliated decentralized exchange—has spiked to over 4% from a recent low below 1%.

Despite the platform's financial success and community engagement efforts, Pump.fun has faced criticism for its approach to token creation. Some argue that this approach has led to the proliferation of questionable altcoins and left many investors with significant losses. However, the platform remains optimistic about its future prospects and is exploring various strategies to maintain its momentum in the competitive memecoin market. As the memecoin market continues to evolve, Pump.fun's approach to revenue sharing and community engagement will be closely watched by industry observers and investors alike.