# pump.fun memo _Is PUMP the crypto social/consumer app we've been waiting for?_ July 25, 2025 • Michael Nadeau --- # pump.fun memo ## Is PUMP the crypto social/consumer app we've been waiting for? Michael Nadeau July 25, 2025 Hello readers, As a reminder, we rolled out [TDR Pro](https://thedefireport.io/research/introducing-tdr-pro?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=pump-fun-memo) (access to our portfolio) this week. Past performance doesn’t guarantee future success, but we’ve already had multiple 10x + exits this cycle. We’re currently positioning for a “risk-on” environment in the second half of the year in which BTC dominance drops and capital shifts along the risk curve. If you’d like access to our portfolio, you can sign up [here](https://thedefireport.io/upgrade?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=pump-fun-memo) (need to create an account first). Year-to-date, pump fun has generated nearly as much fee revenue as the entire Solana Network (base fees + priority fees). Yet PUMP trades at a 99% discount to SOL today. In this week’s report, we’re sharing a memo on pump fun and the “launchpad wars” within the Solana ecosystem. Topics covered: - [The Product & Business Model](#the-product-business-model) - [Addressable Market](#addressable-market) - [Token Economics](#token-economics) - [Fundamentals](#fundamentals) - [The Team](#the-team) - [The Investors](#the-investors) - [Competition](#competition) - [Risks](#risks) - [Closing Thoughts](#closing-thoughts) ***Disclaimer:**** Views expressed are the author’s personal views and should not be relied upon as investment advice. * [](https://bit-digital.com/?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=pump-fun-memo)The DeFi Report is powered by BIT Digital, the leading global platform for high-performance computing infrastructure and digital asset production. NASDAQ: BTBT Let’s go. # The Product & Business Model Pump Fun is a Solana-based platform that enables anyone to create and trade new tokens (primarily memecoins) almost instantly, *without needing to provide initial liquidity.*  Transaction fees drive the protocol’s revenue model. ##### The Product Suite - Mobile App - Desktop App - Livestreaming (where creators can promote their tokens) - Simple interface (it takes a few minutes to launch a token and get it trading) - Integrated bonding curve (this is where tokens minted on the platform can be bought by users, with tokens reaching $69k market cap “graduating” to the pump.swap DEX). Pump makes 1% in fees on each bonding curve purchase or sale. This is where roughly 88% of their revenue comes from. - Pump.swap DEX (launched in March of this year). Pump earns .05% for every trade on the DEX (LPs get .20%, token creators get .05%). This revenue comes from “graduated” tokens and accounts for roughly 12% of the total revenue today. Data: The DeFi Report, Dune (@adam_tehc) Since launching in early ‘24, the platform has generated over $775m in fees. Over that same period, the Solana Network generated $1.16b in fees. *That’s 67% of Solana’s revenue for those counting at home (88% YTD). * By providing creators with a *recurring revenue* stream tied to their tokens (.05% trading fees post-graduation), the platform *aims *to incentivize longer-term community building rather than quick pump-and-dump schemes that have damaged the protocol’s reputation. # Addressable Market Pump’s addressable market is essentially *the global creator economy intersecting with crypto. *The platform targets the millions of content creators, influencers, and community leaders who *might* launch their own token in the future as a new form of monetization. The broader creator economy has grown into a massive market in recent years. In 2024, the industry was estimated to be valued at roughly $191 billion. It’s expected to grow at 20% CAGR (on a path to $500b by 2030). The market encompasses influencers on platforms such as YouTube, TikTok, Twitch, and OnlyFans, among others, who earn revenue through content, merchandise sales, and fan support. We think Pump is essentially positioning itself as a platform where a portion of that creator monetization can take the form of *social tokens or memecoins*, allowing creators to harness “instant money and attention” from their communities. The team is not shy about this. In its own words: “Our plan is to kill Facebook, TikTok, and Twitch. On Solana.” There are currently over 207 million active content creators worldwide, with only a tiny fraction monetizing via tokens today. We’ve been searching for a breakout “consumer/social app” in the crypto space for years now. You might have to squint a little. But, we think it *might* be pump fun. # Token Economics Total PUMP Supply: 1 trillion Vested Supply: 612.3 billion (61.23%) Data: Blockworks Research ##### Unlocks - ICO: fully unlocked - Community: 76% unlocked with the remaining tokens unlocking in July of ‘26. - The Team: 100% locked with the first 25% unlock coming via a cliff in June of ‘26. The remaining tokens will unlock linearly over 36 months through June ‘29. - Existing Investors: 100% locked with the first 25% unlock coming via a cliff in June of ‘26. The remaining tokens will unlock linearly over 36 months through June ‘29. This is the same unlock schedule as the team. - Livestreamers: 100% unlocked. - Liquidity & Exchange: 100% unlocked. - Ecosystem Fund: 100% unlocked. - Foundation: 100% unlocked. ##### Token Buybacks The Pump team has indicated that tokenholders will benefit from a combination of token buybacks and *potential* revenue sharing. In fact, the team has hinted that up to 25% of platform revenues could be distributed to PUMP holders in the future. With that said, investors should understand that tokens do not confer any legal rights to a claim on revenues. The team has already repurchased over 3 billion PUMP tokens (.49% of the existing supply, .3% total supply). Data: The DeFi Report, Dune (@adam_tehc) # Fundamentals ##### Active Users Data: The DeFi Report, Dune (@adam_tehc) Over the last two months, pump fun has been averaging approximately 158,000 active addresses/day. Over the same period, the platform is onboarding roughly 84k new addresses per day. These numbers are down roughly 60% from the peak in January. ##### Tokens Launched Data: The DeFi Report, Dune At its peak, Pump was launching 70k tokens per day. With competition now entering the market (which we cover later), that number has dropped to roughly 10k tokens/day. Fewer tokens launched = fewer bonding curve fees and trading fees for the protocol. ##### Token “Graduation” Rate Data: The DeFi Report, Dune Less than 1% of tokens are “graduating” on Pump today. This is the primary reason the market's perception is that Pump is “extractive.” It essentially tells us that 99% of projects are pump-and-dumps. Today, there are only *278* tokens trading above a $1m market cap. Pump has launched nearly *12 million* tokens since its inception. We’d like to see better incentive alignment with creators to ensure the long-term success of token launches, Pump users, and creators. ##### Trading Volumes Data: The DeFi Report, Dune (@adam_tehc) Note that pump.swap launched in March. Prior to its launch, tokens “graduated” to Raydium for trading (with trading fees accruing to Raydium). With the launch of pump.swap, all Pump tokens graduate to *their own DEX*, where they earn the trading fees (sharing .05% with creators). *Pump is vertically integrating into the tech stack. * # The Team Pump was founded by a trio of young entrepreneurs from the UK: Noah Tweedale (CEO), Alon Cohen (COO), and Dylan Kerler (CTO). All three were in their early twenties at launch. We understand that the protocol was developed in response to the teams own frustrations with the existing memecoin launch & trading experience. An investigation by [Wired](https://www.wired.com/story/pumpfun-founder-memecoin-rugpulls-teen/?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=pump-fun-memo)revealed that Dylan Kerler was involved with launching (controversial) tokens on Ethereum as far back as 2017, at the age of 16. This history (while colored) suggests the technical know-how and understanding of viral crypto markets that Kerler brought to the team. Noah Tweedale and Alon Cohen have been the more public-facing figures. Tweedale is often identified as the business lead, while Cohen actively communicates platform updates and philosophy on X and in the media. [Here’s a recent interview on Bankless.](https://www.youtube.com/watch?v=G6bHIO_PsEM&utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=pump-fun-memo) Despite their youth, the Pump founders have scaled the platform at an unprecedented pace. Over 6.6 million tokens have been launched just this year (12 million total), and the platform has already onboarded 22 million addresses. The team currently has roughly 50 employees, consisting primarily of engineers, data scientists, security experts, etc. # The Investors Pump’s rapid rise was initially bootstrapped by its own revenues. With that said, the project attracted major investors through its recent funding round. The recent ICO (essentially Pump’s Series A) generated $1.3 billion in total. $600 million came from the public ICO (which sold out in 12 minutes on a Saturday!), and $720m via private sales to institutional investors. All ICO investors purchased tokens at $.004 ($4b valuation, fully diluted). The private round allocation (18% of the token supply) went to large backers that are mostly undisclosed. However, industry reports suggest participation from several top-tier crypto funds and companies. According to one report by Blockworks, Pantera Capital, Blockchain Ventures, and Kraken’s VC arm collectively contributed hundreds of millions in the private sale. The token allocation also set aside 13% of the supply to “existing investors,” implying that some early private investors were onboarded even prior to the July ICO. Major crypto exchanges including Bybit, KuCoin, Gate dot io, MEXC, Bitget, and Kraken facilitated the token sale — suggesting that these firms may have also received token allocations. # Competition Pump fun essentially created a new niche on Solana, but competitors are quickly emerging to challenge it. ##### Raydium Launchlab Raydium is the largest Solana DEX in terms of trading volumes. The protocol broke into the launch pad business in March of this year with *Raydium Launchlab* — a direct competitor to pump fun. Pump previously relied on Raydium for trading once tokens on pump “graduated” out of the bonding curve. Tensions formed when Pump announced its plans to launch Pump.swap, cutting Raydium out of its value chain. Raydium responded with Launchlab, and the “launchpad wars” were on. Fast forward 4 months, and you have a completely different market. Data: The DeFi Report, Dune So far in July, Raydium Launchlab has launched a total of 414,000 tokens, compared to 305,000 for pump fun. This has reduced pump’s market share from 99% in Q1 to just 38% today. ##### Let’s Bonk The above chart shows *tokens launched by* *launchpad *(Raydium in green). *But that’s not where the users are. * The users are on Let’s Bonk — a launchpad *interface* to Raydium Launchlab. As such, most of the revenue generated from tokens launched on Raydium Launchlab is accruing to Bonk — who take 1% of all trades on its bonding curve. Raydium gets .25% of all trades *after the tokens graduate* to Raydium DEX. Data: The DeFi Report, Dune (@adam_tehc) ##### Has Pump lost the market? It’s a fair question to ask given the precipitous decline in market share over the last few months. Here’s how we think about that: ##### Product - The Bonding Curve: Bonk iterated on this a bit with the intent for prices to rise more slowly and sustainably. - Bots/Snipers: Bonk forces users to sign an hCAPTCHA — which is used to automatically stop automated bots. More importantly, for 60 seconds post-launch, a “fairness shield” kicks in — capping how many tokens a single buyer can purchase. After that, an AI model watches what’s happening onchain. It’s trained to spot shady activity and has mechanisms to mitigate the impact of shady actors (bots). This is user protection built into the platform — allowing users to feel like they aren’t playing a “rigged game.” - Governance: Once a token graduates on Lets Bonk, the platform auto-creates a basic governance page for enhanced user transparency. Furthermore, the creator token supply is deposited into a community wallet controlled by the DAO smart contract, unlocking the tokens *gradually* according to a publicly announced schedule. This is designed to stop teams from dumping tokens early. Tokenholders can also vote on items such as funding promotion, paying devs, or burning tokens. In essense, these new features have allowed Let’s Bonk to brand the new launchpad as “community first.” Now. Are Let’s Bonk users sticky? Is it over for Pump? Or will the creators and traders flow back to Pump? Nobody knows the answer. But we’ve seen many such instances throughout the crypto ecosystem over the years to give us a hint. ##### The incumbent usually wins Uniswap, Aave, Lido, and MakerDAO come to mind. While it’s not guaranteed, the incumbent tends to win when it comes to crypto protocols. We expect Pump to integrate similar features as Let’s Bonk. But at the end of the day, features don’t win. Brand. Execution (ability to pivot/iterate). Users/community. Integrations/Network Effects. Capital. Token economics. Incentive alignment with users. These are the things that *should* produce the long-term winner. Furthermore, Let’s Bonk still needs to prove that it can onboard *new* crypto users. It hasn’t done that, given that data suggests Pump users simply migrated. For these reasons, we think Pump still has a sizeable lead (even with the recent loss of market share). ##### Creator Incentive Alignment Pump shares .05% of the trading fees on pump.swap with the token creators, aligning incentives for the long term. Let’s Bonk does not share fees with creators. Given Pump’s war chest ($1.3 billion), brand, full-stack offering (interface, bonding curve, DEX, livestreaming), and track record of executing quickly, we still think they have a great shot at being the long-term winner within the crypto space. ##### Incumbent Web2 Platforms Pump’s ultimate competition may actually be incumbent Web2 platforms such as Twitch, TikTok, Patreon, YouTube, etc.) Pump *could* disrupt these platforms by creating a better monetization model for creators. To do so, they’ll need to continue to build “social elements” into the product. If this proves to be successful, livestreaming is the tip of the iceberg here. # Risks - Regulatory & Legal Risks. Legal action was filed in New York in January of this year, accusing the platform of operating an unregistered securities platform. Any enforcement action by the SEC or other regulatory agencies could force Pump to geofence itself from major markets or shut down its services. - Market Adoption & Sustainability Risks. Pump is vulnerable to crypto hype cycles and user retention challenges, given that the vast majority of token launches fail. Not to mention, the platform has faced significant pushback for all the grift it facilitated earlier in the cycle, damaging its brand. - Execution Risk. The Pump team is young, untested, and flush with cash. - Platform & Operational Risk. Moderation of user-generated content is a difficult problem to solve for Pump. Furthermore, the platform faces smart contract and security risks. # Closing Thoughts There’s quite a bit of hair on this one. But you also cannot deny that Pump has: - The only protocol with a full stack offering for new token launches (interface, bonding curve, DEX, mobile app, and social elements). - A massive war chest ($1.3b raised via the ICO). - Product market fit + distribution in a high-growth market (memecoins + creator economy). - A young, competitive team that has shown the ability to execute fast. - A big vision to build a social/consumer app that is disruptive to the current social/consumer app business model. - Controversy. It’s counterintuitive, but the big winners tend to have this. As mentioned, we’ve been looking for a breakout social/consumer app in crypto. It’s *possible* it’s already here. If you’d like to receive our fair value analysis, price targets, and gain access to how we’re expressing our views on PUMP in the market, you can sign up [here](https://thedefireport.io/upgrade?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=pump-fun-memo). Take a Report. And Stay Curious. ***Disclaimer****: Individuals have unique circumstances, goals, and risk tolerances, so you should consult a certified investment professional and/or do your own diligence before making investment decisions. The author is not an investment advisor and may hold positions in the assets covered. Certified professionals can provide individualized investment advice tailored to your unique situation. This research report is for general educational purposes only, is not individualized, and as such should not be construed as investment advice. The content contained in the report is derived from both publicly available information as well as proprietary data sources. All information presented and sources are believed to be reliable as of the date first published. Any opinions expressed in the report are based on the information cited herein as of the date of the publication. Although The DeFi Report and the author believe the information presented is substantially accurate in all material respects and does not omit to state material facts necessary to make the statements herein not misleading, all information and materials in the report are provided on an “as is” and “as available” basis, without warranty or condition of any kind either expressed or implied.*