Solana News Today: Pumpfun Spends $19.2 Million on $PUMP Token Buyback

Pumpfun has executed a significant market maneuver, initiating an open-market buyback that saw the company spend over 118,000 SOL, valued at approximately $19.2 million, to acquire 3.196 billion $PUMP tokens. This action, completed within an 8-hour window, represents a notable shift from the company's previous strategy of selling fee revenue through Kraken.

Funded directly from Pumpfun's protocol fee earnings, the buyback was executed by transferring funds from various fee accounts to a designated wallet labeled “3vkpy5.” The average purchase price for the $PUMP tokens was around $0.006. This move signals a bullish outlook from the team and demonstrates a renewed commitment to bolstering the token’s market value.

Prior to this strategic pivot, Pumpfun had been regularly selling its fee-generated SOL on Kraken. Since May 19, 2024, nearly 4.1 million SOL, valued at approximately $741 million, was sold at an average price of $180. This large-scale selling activity had exerted downward pressure on the market and was widely perceived as a bearish indicator.

However, the recent buyback activity has altered this perception. This is the first instance where Pumpfun has redirected its fee income to directly purchase $PUMP tokens, indicating confidence in the token’s long-term value. The buyback mechanism serves as a robust support level, potentially helping to stabilize the price following the post-presale dip.

Pumpfun recently concluded a substantial $500 million presale, which sold out in just 12 minutes at a price of $0.004 per token. Although the token experienced a slight dip post-launch, the recent buyback efforts have aided in its swift recovery. With buybacks now in effect and fee revenues being reinvested into the ecosystem, Pumpfun appears to be better aligning its incentives with those of its community and token holders. If this trend persists, $PUMP may experience enhanced price support and potential upward momentum in the coming weeks.