Is pump.fun worth 4 billion dollars now?

The industry's largest meme issuance platform pump.fun is set to publicly raise $1 billion at a valuation of $4 billion, which is no longer news. As the meme coin frenzy subsides and the once endless flow of golden dogs is no more, there are many concerns in both the Chinese and English circles about pump.fun issuing coins and potentially siphoning off a large amount of liquidity, with the belief that this could put a temporary end to the meme coin sector.

As a phenomenon-level application leader in the crypto space, pump.fun has been a printing machine in the industry for quite a long time. However, with the retreat of liquidity and narratives, pump.fun is also looking for ways to transform itself, such as learning from traditional internet platforms to create native internet celebrities for traffic. So now, is pump.fun still worth a valuation of 4 billion dollars?

Is a valuation of 4 billion USD worth it?

The historical total revenue of pump.fun is currently approximately $758 million, making it one of the most profitable projects in the Web3 space. According to DefiLlama data, pump.fun's revenue in the last 30 days is $41.61 million. Projects with higher revenue are either stablecoins and their related assets (Tether, Circle, and Tron) or DEXs (PancakeSwap, Hyperliquid), and there are no Solana ecosystem projects that can compete with it.

The annualized income is calculated by multiplying the income of the last 30 days by 12, which is approximately 500 million USD. Corresponding to a valuation of 4 billion USD, the price-to-sales ratio is 8 times, which is not extremely outrageous. Of course, the market's doubts are more about "the current pump.fun cannot support this valuation" rather than "the glorious period of pump.fun cannot support this valuation."

The revenue of pump.fun fluctuates based on the overall market conditions of meme coins. The peaks for the new issuance token "Graduation Rate" of pump.fun were in mid to late November last year and mid to late January this year, where the weekly issuance rates for the token "Graduation Rate" reached 1.67% and 1.62%, which is currently 2 times higher.

Correspondingly, the average daily income during these two periods is at least 4 million dollars, which is basically 3-4 times the current amount, and there are even cases where single-day income exceeds 10 million dollars. The daily issuance of new tokens is also at least 50,000, which is double the current amount.

Regardless of whether pump.fun chooses to issue coins during the peak period or now, they are bound to be criticized. If it were during the peak, the valuation wouldn't be what it is now, and people would blame them for damaging the meme coin bull market. If it's now, they would be criticized for adding fuel to the fire, extracting liquidity and worsening the already low tide of the meme coin market. But if we consider it from another angle, will meme coins see such a hot market again like before? Or will they suffer a setback like inscriptions? Moreover, there are ways to navigate both bull and bear markets. As the project party, pump.fun's actions in the current poor market environment show us that there is hope for revitalizing the meme coin market, and when a possible meme coin bull market returns, will they still be able to maintain their leading position with some form of moat?

Understanding the Divergence Between the Chinese and English Circles

In the Chinese community, aside from the current hot topic surrounding "issue coin" at pump.fun, generally speaking, people either focus on how pump.fun's issuance will drive up some meme coins related to the "platform concept," such as $alon related to founder @a 1 lon 9 or the "mascot" $cupsey. Or they pay more attention to new platforms like letsbonk.fun.

There are two interesting viewpoints. The first comes from KOL crypto influencer @thecryptoskanda, who believes that the "mass media" attribute of pump.fun is unique, and that pump.fun reigns supreme in capturing the attention of the young generation with very short attention spans.

Although @thecryptoskanda's viewpoint is accompanied by some controversy, a very interesting phenomenon has indeed formed between meme players and traditional media. The players who speculate on meme coins, in their pursuit of profits, have inadvertently become a highly efficient group of "journalists" in the world. Meanwhile, traditional media journalists, who may not speculate on coins at all, always report on various happenings in the crypto world on traditional media, inadvertently becoming the "ambassadors" for meme coins.

The second viewpoint comes from @memekiller 365 regarding a recent "meme war image" released by @brainletcto. As $SPX has continued to rise from its bottom over the past month and recently reached a new historical high, established meme coins and new meme coins born from platforms like pump.fun and letsbonk.fun are in a PK situation, with each force operating independently.

So what about the English circle? The English circle actually doesn't have a very distinct version of understanding; it’s still about having fun and enjoying life, with horses running and dancers dancing. However, they are more focused on the live broadcasts of pump.fun, and some community coins of pump.fun also give the impression that, in the current market environment, pump.fun has also slowed down.

From "Fast-Paced Casino" to "Slow-Paced Media"?

Gainzy, an Israeli, is currently the hottest streamer on pump.fun. Recently, due to the conflict, he has had to frequently hide in bomb shelters.

In the past month, an increasing number of Gainzy live stream clips have become popular in the English-speaking community. With the rising popularity, the price of the live coin issued by Gainzy has also been continuously increasing.

In May, pump.fun founder alon commented on Gainzy, saying, "He single-handedly revitalized Ethereum, pump.fun live broadcasts, and hair removal clinics," and referred to him as "the ansem of the last bull market."

So ansem asked (jokingly), "Do you know who Gainzy is?" With over 12,000 votes, 34.8% of voters still chose "I don't know." Even now, the Chinese community may still be at the ansem stage regarding the pump.fun ecosystem star, and is indeed not familiar with Gainzy.

Who is Gainzy? According to a tweet by @StarPlatinumSOL, Gainzy resigned in 2017 and entered the crypto world full-time, initially getting involved in controversy as a dev of a Rug project Obsidian during that ICO bull market. After that, he created a trading bot and sold it in 2018.

Gainzy is still one of the earliest KOLs to promote FTX, with peak monthly commissions reaching as high as $50,000. Before the live broadcast on pump.fun, he was a sponsored streamer by Rollbit, as he promoted $RLB while secretly dumping it, causing further controversy.

ZachXBT also criticized Gainzy at the time, "Why are you tweeting about buying $400,000 of $RLB and then dumping it crazily within less than a day?"

Gainzy initially became popular because he was completely taken down by ETH and then wildly criticized Vitalik and the entire Ethereum Foundation as SB during a live stream that took place on May 8. Following this live stream, ETH began to rise, and the English-speaking community joked that Gainzy helped solidify the bottom for ETH, saving Ethereum.

His live stream doesn't scan the chain or hit the dog; he just smokes one after another and shares his views on cryptocurrency. From the style of the live stream, he resembles a "CSGO streamer Eggplant, who has made money but still streams like a grassroots person." As the popularity grows, figures like Pudgy Penguins CEO Luca Netz and Yuga Labs co-founder Garga.eth have all joined him for live streams.

The latest star of the pump.fun live broadcast is @rasmr_eth. Like Gainzy, he is also a big KOL, with nearly 110,000 followers on Twitter and over 10,000 followers on Twitch. The guy came up and got things going, holding a press conference like Jobs, explaining in detail why he wanted to bring his talent to pump.fun.

$rasmr once surpassed a market value of 15 million dollars after its issuance, but it has now fallen below a market value of 6 million dollars.

There are rumors that pump.fun paid Gainzy and rasmr to come and stream on pump.fun. This rumor cannot be confirmed, but pump.fun's emphasis on live streaming can also be seen from the $1 million streamer incentive that started at the end of May.

In addition to these live streaming stars, the $HOUSE, which saw a significant rise at the end of April, also brought forth new influential figures such as @Fapita l3, @bigtonebigtone, and @Primed 25. In the "meme war chart" mentioned above, $neet, a small coin with a market value of less than 5 million dollars, was included precisely because of the strong support from the aforementioned three individuals. The coin once surged to nearly a market cap of 25 million dollars.

"TYBT", short for "Thank You Big Tone", was one of the hot memes on pump.fun last month. However, recently Big Tone has taken a break, and he can only be seen in small groups and occasionally on Twitter Spaces.

Since the beginning of this year, many platforms for Web3 live streaming have emerged, but pump.fun is undoubtedly the most internet-savvy among all Web3 live streams. Although people's impressions may still linger on the chaotic era of pump.fun live streaming, the current pump.fun seems to be trying to move away from the early wild growth phase of Kuaishou, specifically working on cultivating its own traffic matrix system. Even now, pump.fun can give people a vague sense of PVE illusion, featuring big coins like $FARTCOIN with a market cap over 1 billion dollars, down to smaller coins like $neet and $chillhouse with a market cap of less than 10 million dollars. There are no conflicts between communities, interactions are frequent, and they are quite united.

(As of the publication of this article, the market capitalization of $chillhouse has exceeded 10 million dollars, having previously approached 18 million dollars.)

The founder of pump.fun, Alon, seems to have shown considerable interest in these small coins that present different appearances. In an interview with Decrypt, he specifically mentioned $neet, as this coin organized an offline "No Work" protest on Wall Street using creator incentives provided by the platform. After the official Twitter account of the coin expressed gratitude in a tweet, Alon retweeted it.

$chillhouse has swept across various pump.fun live streams and KOL's Twitter DMs with the viral slogan "Thoughts on chillhouse?", becoming one of the hottest memes in the pump.fun ecosystem recently. It's nothing but nonsensical, like a bunch of drunk people scribbling all over the street. Alon also retweeted related posts about $chillhouse.

The "refusal to work" $neet and the viral absurdity of $chillhouse are both quite appealing perspectives for young people. pump.fun still has the best sense of the Z generation subculture in the crypto space, which serves as their "soft moat."

Of course, from creator incentives to streamer incentives, the criticism of pump.fun in the market has never stopped. Many players believe that pump.fun is struggling with business, and finally the frugal ones are taking out some money to support it. But from the perspective of the project party doing business, having a hot market for gold dogs every day is certainly the best, but one must also think of strategies during dull days. Recruiting influencers, supporting newcomers, and building one's own traffic matrix are necessary to spark the next wave of market frenzy. After all, a market full of gold dogs always starts with one or two gold dogs leading the way. As meme coins have developed to this day, a brainwashing meme or directly transporting memes from Web2 has limited stimulation on players' consumption desires, and it's hard for players to imagine how much space there is (it's hard to break through).

So what to do? The current answer given by pump.fun is – to capture the identity of young people ($house, $neet), not solely relying on hot topics or fleeting meme coin outputs, but attempting to support some meme rhythms that resonate with young people's interests ($chillhouse) and live streaming sales that cater to the tastes of degens in the crypto space.

Conclusion

I don't think that the issuance of pump.fun will be the end of meme coins; it could be a temporary end, but it will never be the end of meme coins. All along, we seem to like blaming a project's failure on a particular project, like how Blur destroyed NFTs. However, if a track can be destroyed by a single project, it indicates that the track was already dead long ago.

There are countless young people in the world who want to change their fate, and cryptocurrency is so far the most enduring and relatively attractive place for young people. The stock market is not short of narratives, as people naturally tend to believe the stories written by elites. Meme coins will not die, because grassroots also need their own stories to change their fate.

After the tide goes out, I actually hope that pump.fun "media" can go further. When "coin stocks" attract the attention of the cryptocurrency circle and become a playground for the elites, the wild yet youthful crypto vibe of pump.fun becomes much more endearing.