Pump.fun (PUMP)

Pump.fun is a memecoin launchpad on the Solana blockchain that lets anyone create a new token in a few clicks and start trading it at once, and PUMP is the platform's own token. Since its launch in January 2024, Pump.fun has been the busiest place to issue meme coins on Solana. Each new token trades on an automated price curve, and the ones that attract enough buyers move on to an ordinary exchange pool.

PUMP is separate from the many thousands of tokens launched through the site. It was sold in a public sale in July 2025, and part of the platform's revenue is used to buy it back and destroy it, although the company states that holding PUMP gives no legal right to that revenue. Pump.fun charges its fees in SOL, the coin described in Solana (SOL).

Think of Pump.fun as a vending machine for new coins. Anyone can walk up, give the coin a name and a picture, and the machine starts selling it straight away. There is no listing committee and no need to find buyers in advance. The machine sets the price by a fixed rule: the more coins people buy, the more the next coin costs, and selling pushes the price back down.

If enough people keep buying, the coin "graduates": the machine hands it over to a normal trading venue where it can be bought and sold like any other token. Most coins never get that far and fade within hours. The PUMP token is different again. It is the vending machine owner's own coin, and the owner uses part of the takings to buy it back from the market.

Pump.fun was launched in January 2024 by a small team whose UK company is Baton Corporation Ltd. It grew quickly as Solana memecoin trading took off. In May 2024 a former employee used borrowed funds and the platform's admin access to drain about 12,300 SOL, worth roughly $1.9 million at the time; the company paused trading, redeployed its contracts and said it would compensate affected users. In December 2024 the UK Financial Conduct Authority warned that Pump.fun was not authorised to offer services in the country, and the platform blocked UK users. In March 2025 it opened its own decentralized exchange, PumpSwap, so graduating tokens no longer had to move to an outside venue. The PUMP token sale followed in July 2025, and in January 2026 the platform changed how creator fees are shared among a token's team.

Each new token has a supply of 1 billion units, most of which are sold on a bonding curve before graduation. The curve works like an automated market maker with "virtual" reserves of SOL and tokens that set the opening price. Their product stays constant as people trade:

• $S$ is the curve's SOL reserve, real plus virtual.
• $T$ is the curve's token reserve, real plus virtual.
• $k$ is a constant, and the current price is $S \div T$ SOL per token.

Using the launch parameters commonly reported for the program, a token opens with $S = 30$ SOL and $T = 1{,}073{,}000{,}000$ tokens, so $k \approx 3.2 \times 10^{10}$ and the opening price is about 0.000000028 SOL. A buyer who pays 10 SOL raises $S$ to 40, so $T$ falls to $k \div 40 = 804{,}750{,}000$. The buyer receives the difference, 268,250,000 tokens, and the price rises to about 0.00000005 SOL, nearly double. When the curve's real tokens are sold out, the collected SOL and remaining tokens move into a liquidity pool on PumpSwap. Trading fees apply at each step and are left out of this example.

PUMP has a total supply of 1 trillion tokens. In the July 2025 initial coin offering, 125 billion PUMP (12.5 percent of supply) were sold at $0.004 each, raising about $500 million in roughly 12 minutes and implying a fully diluted valuation of $4 billion. Within days the platform began using its fee income to repurchase PUMP. In April 2026 it burned the tokens it had bought back, about 36 percent of circulating supply, and committed half of its net revenue from Pump.fun, PumpSwap and its trading terminal to further buy-and-burn for one year, keeping the other half for running the business. The price fell well below the sale price for long stretches after the offering despite the buybacks.

• Losses for traders. Most tokens launched on the platform lose nearly all their value, and automated sniper bots often buy the first units of a new token before ordinary users can.
• Fraud. The ease of launching tokens has made the platform a common venue for rug pulls and pump-and-dump schemes, in which creators or insiders sell out on later buyers.
• Lawsuits. A proposed class action filed in New York in January 2025 claims that tokens sold on the platform are unregistered securities, a question discussed under the Howey test for memecoins; later versions of the claim also accuse the company and Solana-linked firms of running an unlicensed gambling business.
• No rights for PUMP holders. Buybacks are a company policy that can change, as the 2026 cut from all revenue to half showed, and the token is not a share in the business.

Activity on the platform also tracks the wider memecoin market closely, so fee income, and with it the money available for buybacks, can drop sharply when speculative trading cools.

• Pump.fun
• Financial Conduct Authority warning: Pump.fun