- Pump.fun now allocates 100% of daily revenue to PUMP buybacks, up from 25%, driving strong bullish price action.
- Despite a 25.6% surge, platform revenue fell below $300K, raising doubts about sustaining aggressive buyback strategies.
- RSI at 68.46 and volume up 79% suggest bullish momentum, but rejection near $0.003229 could lead to a price pullback.
The price of Pump.fun’s native token, PUMP, rose by 25.6% in the past 24 hours, following a major shift in its buyback structure. According to on-chain records, the platform has increased its buyback allocation to 100% of daily revenue.
This change, executed without a public statement, follows a previous 25% allocation rate and reflects a sudden strategy shift by the platform’s treasury. Pump.fun has previously conducted a $19.26 million buyback of 2.99 billion tokens, and the new approach appears to continue this aggressive model.
Despite this, daily earnings have recently dipped below $300,000, a level only seen twice before in September 2024. These developments raise questions about the sustainability of the buyback initiative amid falling revenue.
Buyback Shift Drives Demand Amid Revenue Slump
Pump.fun’s revised policy, implemented on July 30, redirects all platform earnings toward PUMP token buybacks. This increases demand pressure on the open market and may reduce sell side liquidity.
The move comes as daily platform revenue recorded a sharp drop to under $300,000 on Monday. On-chain data confirms the revenue redirection, though no official statement has been issued.
The current strategy follows earlier buybacks, including a $19.26 million token repurchase, and points to ongoing efforts to support price action. However, the reduced revenue base could limit the scale of future purchases if current trends persist.
Technical Indicators Suggest Growing Bullish Pressure
PUMP rebounded from oversold levels, with RSI rising from 26.32 to 42.35. The asset currently trades, just below the upper Bollinger Band at $0.003229. Price action also shows a breakout above the midline of the Bollinger Bands, which is set at $0.002768.
The 24-hour volume surged to $621 million, a 79% increase from the prior day, and now represents 56.4% of the token’s market cap. This surge in trading activity suggests strong market activity. RSI is at 68.46, nearing overbought levels but still with potential for more upside.
Market Conditions Add Strength, But Risks Remain
Pump.fun’s rally is unfolding during a moderately favorable market environment. The Fear & Greed Index currently is at 62, indicating growing risk appetite. In addition, the Altcoin Season Index has jumped 85.71% over the past 30 days, though it remains neutral at 39.
These conditions have created a supportive backdrop for speculative assets like PUMP. However, sustaining momentum may depend on the platform’s ability to maintain buyback volumes despite declining revenue.
Potential Price Scenarios
If buying pressure continues and the price breaks above $0.003229, PUMP may retest $0.0035 or even higher levels. However, rejection at current resistance levels and weakening volume could lead to a pullback toward $0.002768 or possibly $0.0023.
Final Outlook
PUMP’s recent price breakout follows a sudden and aggressive shift in buyback strategy, pushing volume and technical indicators upward. However, falling revenue levels raise concerns about long term sustainability.
