Author: Sunny Shi, Messari Crypto
Translator: Alex Liu, Foresight News
Original Title: Messari Predicts: PUMP Reasonable Valuation May Reach $7 Billion, Buying in Public Sale Means Profit?
According to media reports citing informed sources, pump.fun is preparing to sell 25% of PUMP tokens at a $4 billion valuation to raise $1 billion.
Is this price attractive?
Sunny Shi from Messari built a valuation model for PUMP, which shows that its Fully Diluted Valuation (FDV) could reach $7 billion. If the prediction is correct, buying PUMP tokens would be profitable. But there is an important premise. Here is their valuation process (from Sunny Shi's perspective, "we" refers to Messari):
Regardless of how you view meme coins, this track continues to "print money".
Although the trading volume of the pump.fun token launch platform has declined compared to the beginning of the year, it remains far higher than most of 2024.
Pump.fun's trading volume is higher than most of 2024, data: Messari
People may have also underestimated the success of PumpSwap. This DEX launched about three months ago but has already significantly eaten into Raydium's market share on Solana.
Market share comparison between PumpSwap and Raydium, data: Messari
Our valuation method uses a top-down model, assuming overall crypto market trading volume, Solana's share, platform launch share, and PumpSwap's market share. These assumptions and models are only available to enterprise clients, but I will share the main conclusions.
In our base case, we believe meme coins will occupy a niche in the broader crypto economy because they are more suitable for speculative purposes than Non-Fungible Tokens.
Of course, as the Solana ecosystem matures, it will undoubtedly diversify into new assets, but this point is also likely to hold.
We believe that even if pump.fun's share in the Solana ecosystem slightly declines, with PumpSwap continuing to grow, the pump project is still expected to generate around $675 million in revenue over the next two years.
Calculated at a 10x valuation multiple, the corresponding FDV is approximately $7 billion.
However, the key premise is: if the project team chooses an opaque token/equity structure that allocates most of the revenue to insiders rather than token holders, we believe the current market has become quite cautious and will not overlook such a poor value accumulation method.
In our complete report, we provide valuation tables to assess PUMP's potential value based on the percentage of revenue that token holders can obtain.
Regardless of how the market ultimately judges, this is an excellent opportunity to participate in the most profitable crypto application in history. Now it depends on whether the project team provides token holders with enough participation value (buy-in) to make it a worthwhile investment.
Editor's Note:
In Aevo's pre-market perpetual trading market, PUMP is currently priced at $6, corresponding to a $6 billion Fully Diluted Valuation (FDV).
PUMP's pre-market price on Aevo
