The largest meme issuance platform in the industry, pump.fun, raising $1 billion at a $4 billion valuation is no longer news. As the meme coin craze subsides and large MC memecoins are no longer as prevalent, both Chinese and English-speaking circles have widespread concerns that pump.fun's token issuance will drain significant liquidity, believing this might temporarily conclude the meme coin track.
As a phenomenal application-layer leader in the crypto space, pump.fun has been a money-printing machine for quite a long time. However, with the retreat of liquidity and narrative, pump.fun is also seeking transformation, such as learning from traditional internet platforms by cultivating platform-native internet celebrities. So, is pump.fun still worth a $4 billion valuation now?
$4 Billion Valuation - Is It Worth It?
pump.fun's total historical revenue is currently around $758 million, making it one of the most profitable projects in the Web3 domain. According to defillama data, pump.fun's revenue in the past 30 days is $41.61 million. Projects with higher revenue are either stablecoins and related entities (Tether, Circle, and TRON), or DEXs (PancakeSwap, Hyperliquid), and no Solana ecosystem project competes with it.
Calculating annualized revenue by recent 30-day revenue * 12, it's approximately $500 million, corresponding to an 8x price-to-sales ratio for a $4 billion valuation, which isn't entirely unreasonable. Of course, market doubts are more about "pump.fun can't support this valuation now" rather than "pump.fun at its peak couldn't support this valuation".
pump.fun's revenue fluctuates based on the overall meme coin market's popularity. In mid-to-late November last year and mid-to-late January this year, pump.fun's new token "graduation rate" peaked, reaching 1.67% and 1.62% respectively, double the current rate.
Correspondingly, the average daily revenue during these periods was at least $4 million, basically 3-4 times the current rate, with some days even exceeding $10 million. The daily number of new token issuances was at least 50,000, double the current rate.
Whether pump.fun chooses to issue tokens at its peak or now, it will certainly be criticized. If during the peak, the valuation wouldn't be what it is now, and people would criticize them for destroying the meme coin bull market. If now, people would criticize them for adding fuel to the fire and draining liquidity, making the already low meme coin market even worse. But from another perspective, will meme coins be as hot as before? Or become stagnant like inscriptions? Moreover, bull markets have their way, and bear markets have theirs. As a project, can pump.fun's current actions in this terrible market environment show us hope of reviving the meme coin market and maintaining a moat to stay ahead when a potential meme coin bull market returns?
Gainzy initially became famous because he was triggered by ETH and then went on a live stream, wildly criticizing Vitalik and the entire Ethereum Foundation as idiots. This live stream occurred on May 8th. Influenced by this stream, ETH began to rise, and the English-speaking community jokingly said Gainzy helped solidify ETH's bottom and saved Ethereum.
His live stream didn't involve scanning chains or attacking others, just smoking cigarette after cigarette and sharing his views on cryptocurrency. From his streaming style, he resembles a "CSGO streamer who made money but still streams like a grassroots personality". As his popularity grew, figures like Pudgy Penguins CEO Luca Netz and Yuga Labs co-creator Garga.eth even connected with him for live streams.
The latest pump.fun streaming star is @rasmr_eth. Like Gainzy, he's a major KOL with nearly 110,000 Twitter followers and over 10,000 Twitch followers. He started by making a scene, holding a press conference like Jobs, and elaborately explaining why he brought his talents to pump.fun.
$rasmr once broke through a $15 million market cap, but has now dropped below $6 million.
There are rumors that pump.fun paid Gainzy and rasmr to stream on their platform. While unconfirmed, pump.fun's emphasis on streaming can be seen from the $1 million streamer incentive program that began in late May.
Besides these streaming stars, $HOUSE, which rose significantly in late April, also brought out new influencers like @Fapital3, @bigtonebigtone, and @Primed25. In the previous "meme war map", $neet, currently with a market cap under $5 million, was included precisely because of the strong support from these three. The coin once rose to nearly a $25 million market cap.
This year, many Web3 streaming platforms have emerged, but pump.fun is undoubtedly the most trendy among all Web3 streams. While people's impressions might still be of the chaotic pump.fun streaming era, the current pump.fun seems to be trying to move beyond its early rapid growth phase, purposefully cultivating its own traffic matrix system. It even creates a sense of PVE, where from large coins like $FARTCOIN with over $1 billion market cap to small coins like $neet and $chillhouse under $10 million, communities interact frequently and are remarkably united without conflict.
(By the time of this article, $chillhouse's market cap had exceeded $10 million, once approaching $18 million)
Pump.fun founder alon seems to have given considerable attention to these coins showing different characteristics. In an interview with decrypt, he specifically mentioned $neet, as the coin used platform creator incentives to organize an offline "not working" protest on Wall Street. After the coin's Official Twitter expressed gratitude, alon retweeted.
$chillhouse swept through pump.fun live streams and KOL Twitter DMs with the viral slogan "Thoughts on chillhouse?", becoming one of pump.fun's hottest memes recently - nonsensical, like a group of drunk people scribbling on the street. Alon also retweeted posts related to $chillhouse.
"Refusing work" $neet and the viral nonsensical $chillhouse both strongly resonate with young people. pump.fun still has the best sense of crypto's Gen Z subculture, which is their "soft moat".
Of course, from creator incentives to streamer incentives, market criticism of pump.fun has never stopped. Many players believe pump.fun is struggling and finally releasing some money. But from a business perspective, while a hot large MC memecoin market is ideal, during calm periods, strategies must be developed. Recruiting influencers, supporting new talents, and building a traffic matrix can create a "trigger" for the next market frenzy. After all, markets with numerous large MC memecoins always start with one or two leading the way. As meme coins have developed, a brainwashing meme or directly porting a Web2 meme has limited ability to stimulate players' consumption desires and imagination.
So what's the solution? pump.fun's current answer is: capture young people's identity recognition ($house, $neet), not solely relying on hot or momentary meme coin production, but attempting to support meme rhythms that excite young people and continuously create memes ($chillhouse), as well as livestream marketing that caters to crypto degen tastes.
Conclusion
I don't believe pump.fun's token launch is the ultimate end of meme coins - it might be a stage-end, but certainly not the final end. We've always liked to blame a track's failure on a specific project, like Blur destroying NFTs. But if a track can be destroyed by one project, it means the track was already dead.
There are countless young people wanting to change their destiny, and cryptocurrency remains the most enduring and relatively most attractive place for young people. The stock market isn't lacking narratives - people naturally believe stories written by elites. Meme coins won't die because grassroots people also need their own stories of changing destiny.
After the tide recedes, I actually hope pump.fun's "media" can go further. When "coin stocks" absorb crypto's attention and become a playground for elites, the wild but young crypto flavor on pump.fun becomes more endearing.
Click to learn about BlockBeats job openings
Welcome to join BlockBeats official community:
Telegram Subscription Group: https://t.me/theblockbeats
Telegram Discussion Group: https://t.me/BlockBeats_App
Official Twitter Account: https://twitter.com/BlockBeatsAsia
