web3: pump.fun Turns Repurchase Position Profitable, $PUMP Ends 9-Month Loss

CoinWorld reports:

After continuously using protocol revenue to repurchase $PUMP, pump.fun has turned this position profitable after approximately 9 months of losses. Data from Blockworks Research indicates that the recent strengthening of the token price has brought this repurchase plan back into positive yield territory.

Protocol Revenue Recently Rebounds

This change coincides with a resurgence in trading activity on the Solana blockchain. Reports indicate that pump.fun's revenue has significantly increased in recent weeks, with weekly revenue rising from just over $6 million in early July to $11 million last week.

In April, pump.fun reduced the proportion of protocol revenue allocated for $PUMP repurchases from 100% to 50%. Nevertheless, with revenue growth and a rebound in token prices, the performance of the repurchase plan has shown improvement.

• Weekly revenue in early July: just over $6 million
• Weekly revenue last week: approximately $11 million
• Price increase since July 12: approximately 99%

Market Sentiment Shifts

The report suggests that, in addition to increased repurchase efforts and market attention, early investors have not concentrated on selling off their tokens after unlocking, which has altered external perceptions of $PUMP. An asset that was previously avoided by some traders has recently become one of the stronger-performing tokens on the Solana network.

The article also notes that although tokens bought through the repurchase mechanism are technically destroyed, the price performance of $PUMP has reignited discussions in the market about "the effectiveness of repurchases." Some projects choose to buy back tokens from the open market using protocol revenue to signal aligned interests to holders.

Repurchase Model Gains Attention Again

There has always been a divide in the market regarding token repurchases. Opponents argue that this practice may merely inject project revenue into the market, providing liquidity for other investors to exit, and may not necessarily create lasting value.

However, with the repurchase position of $PUMP turning profitable, supporters' voices are increasing once again. Bitwise Chief Investment Officer Matt Hougan believes that repurchases are a strong method of value capture. Some market participants compare $PUMP with $HYPE, suggesting that whether repurchases are effective depends on the project's revenue-generating ability and market confidence in the model itself.

The report also mentions that Hyperliquid's Assistance Fund will also use protocol revenue to buy $HYPE. This fund currently holds 46 million $HYPE, with a market value of approximately $2.76 billion based on the article's figures, and an average purchase cost of $26.56 per token, resulting in an unrealized gain of about $1.5 billion.

In contrast, while pump.fun's repurchase plan has just emerged from losses, there remains a significant gap in both repurchase scale and unrealized gains compared to Hyperliquid.