Author: Ma He, Foresight News
On July 21, Pump.fun officially announced the launch of BOOST mode, setting it as the new standard default launch mechanism for tokens. After the announcement, PUMP's price continued to fluctuate around $0.002.
According to official explanations, historical data shows that whenever a token graduates from the bonding curve and migrates to a liquidity pool, approximately 20% of the liquidity becomes "dead liquidity." Even if all holders sell, these funds remain permanently locked in the LP, becoming unusable. The platform estimates this mechanism causes over $100 million in liquidity to be permanently lost annually.
The core action of BOOST mode is straightforward: use these funds, which would otherwise be wasted, to continuously buy the token via TWAP (Time Weighted Average Price) during the first 5 minutes after migration, and immediately burn all purchased tokens. When a token graduates, Pump.fun will forcibly withhold about 20% of the funds. Calculated based on fixed migration rules, this amounts to withholding 17.6 SOL for SOL pairs and about $2516 for USDC pairs.
These funds entirely come from the "sacrificed" portion of liquidity during previous migrations, not from new platform subsidies. After the purchase is completed, the corresponding tokens are directly burned, creating short-term buying pressure while permanently reducing circulating supply.
Using Reserve Funds to Provide a 5-Minute Buy Pressure for Tokens
Pump.fun's classic process is: users create a token with one click, then trade on the bonding curve. When the token reaches a certain market cap threshold, it automatically migrates to the PumpSwap liquidity pool. During migration, the platform locks a portion of the liquidity into the LP at a set ratio to ensure subsequent trading depth.
The problem lies in the high proportion of these locked funds. Even if the token's price later goes to zero and everyone sells out, a sum of "dead money" remains in the LP. This money can neither be withdrawn nor redeployed to other active assets, resulting in systemic capital waste. The official estimate is "over $100 million annually."
BOOST mode does not change the bonding curve trading experience or adjust the graduation threshold itself. It does not arbitrarily add or release any external liquidity. Its essence is to extract the 20% of settlement funds originally intended for the LP and use them to buy and directly burn tokens on the secondary market via TWAP over 5 minutes.
The official explicitly stated that tokens migrated after 22:23 (Beijing Time) on July 21 automatically have BOOST enabled. Tokens migrated before this time, as well as those launched via the Mayhem (AI Agent Lab) mode, do not benefit from this mechanism.
A 5-Minute Fireworks Show
As of July 22, Pump.fun's current annualized revenue is approximately $342.54 million, with total token buyback value around $411.27 million. However, its token price remains far from its all-time high of $0.008. Relying solely on large-scale buybacks can hardly effectively boost price expectations anymore.
The essence of BOOST is not to add another round of buybacks for PUMP, but to attempt to solve the product issues of the launchpad itself.
The logic behind this might be: if meme coins after graduation have slightly thicker order books and better short-term performance, trader retention and repeat purchase intentions would be higher. Most PVP (Player vs. Player) players don't care about a meme coin's fate three days later; they care about whether it can "pump" at the moment of graduation. The Pump.fun team likely sees through this. Instead of locking 20% of funds defensively in the LP pool, it's better to turn that money into a 5-minute "fireworks show."
The platform's real moat isn't "high token launch volume," but "a certain proportion of launched tokens can continuously generate trading volume." Only when the latter stabilizes can protocol revenue truly be sustainable. Stable or growing revenue provides continuous ammunition for buybacks, rather than appearing like "using存量 revenue to barely support the price."
Of course, many traders are concerned that the additional buying pressure could lower the actual difficulty of project launches, potentially making more low-quality tokens appear "successful," thereby encouraging more aggressive launch behavior. Others point out that the 5-minute TWAP buying window is still short. Once buying stops after 5 minutes and faces large sell orders, the token price could crash with even more exaggerated slippage than before. This essentially trades extremely high post-pump dump risk for a 5-minute pumping illusion.
