🚩 Pump.fun Buybacks: Something is Bad!

Added: 2026-05-06

[00:00:00]Headlines in crypto always are super bullish. For example, Pump just bought a million dollars worth of tokens and is propping up the price. But we can't just follow the headlines. We have to stay realistic because when we actually look at the data, we can see how the purchases are slowing down over the last weeks. Hi, my name is Gerhard. I'm in crypto for the last 8 years. I started this channel 5 years ago and 3 years ago, I hit my first million. And I did this through active investing. So this is my outperformance month over month over buying and holding Bitcoin. On average, it's 2% every month. That's then how that compounds over time.

[00:00:38]That's then how that looks like with additional investments regularly put into the portfolio. I don't just talk the talk, I also walk the walk. So there is a copy trading capital pool last year that outperformed Bitcoin quite a bit.

[00:00:52]This year, we are outperforming again.

[00:00:54]And so in this video, I want to share the data points that I look at in order to figure out where Pump might be going from here. Is the Pump token very cheap?

[00:01:03]Is it expensive? What are the tokenomics? What's going to drive demand and supply? Now have a look at the usage of Pump.Fun. This is the revenue over time. It peaked at the beginning of 2025 and since then is relatively stable measured in US dollars. Here we've got the decentralized exchange trading volume. That peaked a bit later, so in May of last year, but is also not necessarily growing. Here we've got the total value locked, so how much capital is currently on the Pump.Fun ecosystem.

[00:01:35]Measured in US dollars, the chart doesn't look that great, but measured in Solana, it does. And so is this potential opportunity? Are a lot of people overlooking the fact that the Pump ecosystem is actually growing despite crypto itself rather having a hard time recently. Now the news is not just about the buying back the Pump token. The main announcement came here on Twitter 6 hours ago. That we don't just have our buybacks, but that the 370 million worth of Pump that got bought back all got burnt. They got removed from the circulating supply forever. And an improvement in tokenomics, a reduction in circulating supply, should actually accelerate the price much more.

[00:02:17]Now why did Pump not appreciate more?

[00:02:20]This is the Pump price in US dollars over time. Here is the price relative to the others market cap. So how is Pump doing relative to all the other altcoins? We tend to see higher lows but a lot of volatility and we could make the argument that we also have lower highs and we could see a breakout very soon. A breakout that could help Pump outperform the rest of the market by 40% potentially even 160%.

[00:02:47]That's the bull case. But since the majority of Pump trading volume happens on the Solana chain, we should look at its price relative to Solana because in the end, the TVL appreciation, the usage of the platform measured in Solana went up over time. But interestingly enough, the Pump token itself did not outperform Solana. It rather tends to trade in an equilibrium. So all of those purchases, right? 370 million of Pump tokens getting purchased and then burnt, they don't really help the outperformance.

[00:03:18]And that's surprising. There seems to be a hidden source of selling as well. And that source of selling is not openly disclosed because apparently the circulating supply of Pump is stable.

[00:03:29]There will be unlocks in the future. The team will get tokens to sell them off over time. But one potential explanation of what's going on here is that maybe behind the scenes the Pump team has sold Pump tokens over the counter OTC. So that then perpetual futures traders bet on falling prices of Pump but at the same time having positive exposure to the price via those OTC deals. The market cap of Pump is at 600 million, which is not that high. The largest token in the Pump ecosystem is Fart Coin with 200 million. Let's have a look at the on-chain metrics. So on the Solana chain, the number of token transfers over time tends to rather go down. There are now 118,000 holders on chain, but more and more of the trading volume is done by the small retail investor. So the wallets that have less than a thousand dollars worth of Pump. The whales tend to be less and less interested in trading the token over time. Now in total, we've got all of those holders, 118,000.

[00:04:28]But when we've got a cutoff that equates to holding at least $1,000 worth of the Pump token, this tends to go down. So the number of investors in the Pump ecosystem, in the Pump token itself, is not growing. And that's not good. We want to see the investor base grow because as there's more people entering an ecosystem, the price tends to go up.

[00:04:49]When there's no growth, that's not good.

[00:04:51]In the last 24 hours, we had 21 million worth of trading volume on the spot market. We had 56 million worth of trading volume on the perpetual futures market, which interestingly enough was led by Hyperliquid, not by Binance, not by OKX, not by a centralized exchange, but by Hyperliquid. The funding rate for those bets on the Pump price tends to hover around zero. That means the market is relatively neutral about Pump's future price development, but the open interest is very, very low. And there is positive correlation between open interest and the price. In other words, when there's more bets on the price, when there's more attention, more people bet on the Pump price, then the price itself tends to go up as well. As less people bet on the Pump price, the spot price tends to go down. Currently, we are very low in the amount of bets on the Pump price, which is good because that would mean if suddenly we see another wave of attention and new bets, then the spot price could go up again.

[00:05:49]The same is true for the trading volume on the perps, it's rather low. And it's true for the number of liquidations on Pump, there's pretty much none. And so the outlook for Pump is rather mixed, right? We don't really know what the source of the selling is. Apparently, there are others tokens that get bought and burnt, yet the price doesn't outperform Solana. Fundamentally, when there's some ambiguity like this, then I treat an altcoin just like any other.

[00:06:13]The vast majority of altcoins tend to go down over time. This is the performance of the Binance listed altcoins over the last year. Yes, there are a few outliers here and there, Zcash being the main outlier, but the vast majority is going down. And I rather want to bet on the market structure. If most altcoins go down because they've got all of that selling pressure, right? Token unlocks worth several hundred millions every single week. The early investors and the team and the venture capitalists, they cash out all the time on the back of the retail investor when that's what's going on. And as most altcoins go down, then I just want to make money in the same way.

[00:06:51]And that's how we achieve the outperformance that I mentioned at the beginning of the video. It's simply betting on poorly performing alt coins to continue to underperform Bitcoin. So if you want to know what kind of altcoins I bet on, for example here, this was a shorting signal for BitTensor. I bet on falling price of BitTensor over here based on a simulation of buying and selling that particular token. So that was a backtest. Then you can simply manually copy trade me. There's also an automatic copy trading pool for all the annual subscribers. A link to premium pops up here on the screen. If it's your very first time here, feel free to subscribe.

[00:07:27]I publish here as regularly. A like would be very much appreciated as well.

[00:07:29]See you next time on YouTube. I'll see you on premium. Cheers.