A \$4 Billion Sky-High Valuation, Team Holding Over 40% of the Supply, is Pump.fun's Public Sale Worth Participating In?

Original Article Title: "Pump.fun Highly Valued Coin Launch Criticized as Founder's Past Statements Surface"

Original Article Author: Nancy, PANews

At the moment Pump.fun officially announced its coin launch, the tension on-chain, which was already taut, tightened once again. Some criticized its inflated valuation after being overtaken by its competitor LetsBONK, while others worried that it would quietly exit after squeezing out the last wave of liquidity.

Project Valuation and Contract Trading Prior to Spot Open

On the evening of July 10th, Pump.fun, which had multiple coin launch rumors circulating, finally broke its silence and officially announced that it would kick off the launch of its native token PUMP on July 12th, with a promise of a large-scale airdrop soon to follow. According to official disclosure, the total supply of the PUMP token is 1 trillion, with allocations for community and ecosystem plans, team, existing investors, and the remainder distributed to ecosystem funds and the foundation.

The token launch will offer 150 billion PUMP tokens at a unit price of 0.004 USDT, accounting for 15% of the total supply, with an expected total fundraising of $6 billion, corresponding to a project's overall valuation of around $40 billion.

Unlike many other popular projects that often choose to debut on top platforms, this Pump.fun launch will be carried out through exchanges such as Bitget, Bybit, Kraken, Gate.io, where participants can use assets like bbSOL, SOL, or USDT to make purchases. This event will continue until the tokens are sold out or until July 15th at 14:00 UTC. It is worth noting that users from the US and UK will be unable to participate due to compliance issues.

According to the PUMP release schedule, the tokens allocated to the team and existing investors will begin to unlock gradually starting from July 2026, while the portion allocated to the community and ecosystem plans will unlock gradually from the first day of token issuance and will be fully distributed by July 2026. The other token allocations to liquidity + trading platform, and foundation will be fully unlocked on the first day of token issuance. Additionally, the official statement mentions that the PUMP token will have its transfer function enabled within 48 to 72 hours after the sale ends, with free trading not initially available in the initial stage.

Subsequently, Pump.fun founder Alon also tweeted to disclose the project's future key development strategies: 1. Enhancing the quality, sustainability, and diversity of already listed tokens: the future creator revenue-sharing mechanism will be expanded to include CTO projects, and further adjustments will be made to the fee structure. 2. Doubling down on investment in the social field: further investment and focus on the Pump.fun live streaming feature. 3. Continued investment in enhancing user experience. 4. Expanding the team size: the current team's foundational framework has been preliminarily established, with over 70 core members covering various areas such as engineering, data, security, trust and compliance, legal, operations, and growth; active team expansion will continue through recruitment and strategic acquisitions, with the first acquisition set to be announced soon.

Pump Coin Offering Met with One-Sided Criticism, Founder's Past Statements "Exposed"

Currently, the MEME market liquidity and sentiment have undergone significant changes. As a long-standing leader in the MEME space, Pump.fun not only faces a sharp decline in daily revenue and daily active users but has also been overtaken by competitors like LetsBonk in market share (related reading: Letsbonk Surpasses Pump.fun as the Top MEME Launch Platform, Several Key Metrics Exceed Pump.fun for the First Time). However, Pump.fun initiated a public offering with a valuation as high as $40 billion, triggering overwhelming doubt and criticism within the community, suggesting a potential draining of the already limited market liquidity, further exacerbating market weakness.

Adding to the embarrassment, past statements from Pump.fun founder Alon have been resurfaced by the community, leading to a "face-off" moment. Alon had previously stated in March 2024 that a presale must be marketed to prove the valuation is reasonable, bringing enormous performance pressure. The only benefit of a presale is that it allows you to pocket the funds raised. Conclusion: Every presale is a scam. Not only that, he also bluntly stated that exchange listings are dead, as listing without transparency would lead to misconduct and poor coin choices.

According to jocy, a partner at IOSG Ventures, Pump.fun, although once achieved a splendid $7 billion protocol revenue, recent data shows a staggering 92% decrease in daily revenue, with the market share dropping to 39.9%, being surpassed by the competitor LetsBonk. The severe issues exist with the current $40 billion valuation: lack of transparent governance structure, unclear team vesting clauses, and overvaluation during the bear market of meme coins. He believes that the team has acquired massive wealth through fees, and the team has neither the intention nor the ability to manipulate or control the market. This seems more like an "exit liquidity" rather than a long-term development plan. It is suggested that investors view this as a highly speculative gamble, not a fundamental investment; patiently wait a week after token listing to make a decision and adopt a phased participation strategy to reduce risk exposure.

Regarding the valuation controversy, crypto KOL @Michael_Liu93 has also raised similar questions. If the Pump trading volume is still leading, a $4 billion valuation can be justified, even with room for upward valuation. However, the reality is that Pump is in second place. With a business volume only a third of bonk's, it has set a valuation twice as high as the leader's, making it difficult to convince the market to further raise Pump's price. As Pump is a "benchmark project," if the performance is poor, it will trigger an avalanche for the entire launchpad track. The game is coming to an end.

Crypto researcher @rezxbt has pointed out sharply that Pump.fun is staging a thorough "harvesting operation." Its tokenomics model seems like a scam from every angle, having made $750 million in revenue in the past year without investing a penny back into the ecosystem. Now, through a public offering, it is trying to squeeze out more funds. The team holds over 40% of the $PUMP tokens, yet they are selling tokens to the community that once supported Pump.fun and helped it thrive, which is simply rug pulling.

However, some voices hold a different view, with rumors even suggesting that several top crypto funds have sold their meme coins to participate in Pump's fundraising. KOL @0xShual believes that singling out Pump.fun for criticism is unfair. If $PUMP fails, other projects (such as launchcoin or bonk) will also not stand alone. They made rational financial decisions, which is not a sin. Pump is a profitable company that identified issues, proposed solutions, showcased delivery and growth capabilities, and made a lot of money as a result. Compared to overvalued L1s without real users, he prefers to hold shares of a profitable, growing company. If the market is willing to sell other assets for $PUMP, it precisely indicates that it is a quality asset. He believes that the narrative of 'MEME track is dead' is only temporary sentiment. If Pump can airdrop, launch a product matrix, and establish a revenue-sharing mechanism in the future, the market sentiment is likely to reverse rapidly.

He further points out that the key to determining whether a project is truly worth holding long-term lies in two factors: whether it has a strong enough narrative and market hype expectations, and whether it has real sustainable income and is willing to reward token holders in a systematic manner.

The issuance storm of Pump.fun actually reveals the collective dilemma MEME markets face, namely sentiment downturn, liquidity crunch, and overextended valuation. However, despite the meme narrative being nearly exhausted, with few true beneficiaries, there are still people willing to queue up to bet like scratching a lottery ticket. The issuance business hasn't stopped, and new platforms are continuously coming online.