The PUMP token from Pump.fun is experiencing a more significant decline than Solana itself, with its value relying heavily on a factor that has just begun to decrease.
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Pump.fun (CRYPTO: PUMP), the premier memecoin launchpad on the Solana network, has seen its PUMP token drop 23.4% in the last fortnight. By comparison, Solana (CRYPTO: SOL) has decreased by 8.5% during the same timeframe, with PUMP trading at $0.0042, reflecting a sharper dip than its underlying blockchain.
This downturn has undone gains made in early October, resulting in a 5.5% drop over the past month. After a brief upswing in late September and early October, the token is now 52% below its peak value.
Pump.fun’s Buyback Reduces as Memecoin Activity Declines
Pump.fun allows users to easily create their own memecoins, with the platform earning fees for each trade. Revenue from these fees peaked in early October but has since declined, adversely affecting the PUMP token’s value.
The PUMP token’s price is primarily supported by a buyback initiative. Pump.fun uses a part of the fees collected to buy back PUMP from the market, subsequently burning these tokens to reduce the overall supply. This mechanism aims to enhance the value of existing tokens. Higher trading activity increases buyback levels, whereas a slowdown leads to reductions.
Prior to the price decline, Pump.fun boasted significant engagement. Reports indicated that the week ending October 4 marked the highest revenue week since September 2025. However, since then, the daily buyback activity has decreased. Additionally, the company mentioned that inaccuracies in their fee-tracking dashboard have arisen following the introduction of custom trading pairs, complicating the evaluation of the downturn’s impact.
Solana Dropped Below $100, While PUMP Plummeted More Severely
The overall downturn in the cryptocurrency market has also played a role in the decline of PUMP. Bitcoin (CRYPTO: BTC) was valued at $79,401 on October 26, reflecting a 2% decrease for the week and a 5% drop for the month. Meanwhile, Solana experienced a3.4% loss over the week and 16.4% over the month, a larger drop than Bitcoin.
Following a peak of $113 on October 12, SOL fell briefly below $100, reaching approximately $98.50 on October 24. Despite a closing price of $102, declines persisted, with SOL recording four consecutive lower closes following its previous close of $107 on October 21.
The value of PUMP is closely tied to the revenue from a single app, contrasting with SOL’s broader functionalities encompassing payments and lending. As SOL depreciates, traders often withdraw from memecoin ventures, adversely affecting Pump.fun revenue and restricting the buyback process.
Is Pump.fun’s Memecoin Operation on Solana Losing Momentum?
Although PUMP is down 5.5% in the past month and SOL has experienced a more significant 16.4% decline, the latest downturn suggests a correction rather than a meltdown. Its previous revenue peak in September 2025 provides a glimmer of hope; however, a rapid rebound seems improbable unless memecoin transactions surge back to early October levels, and Solana shows signs of waning trader interest.
The upcoming revenue report for Pump.fun will be pivotal. Should it reveal higher fees than those seen in the week ending October 4, it could alter the current narrative, possibly revitalizing the buyback initiative. Conversely, if SOL closes beneath its recent low of $98.50, PUMP may face an even sharper decline, as a falling SOL typically curbs the trading necessary to sustain the buyback mechanism.
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