1) A Valuation of $PUMP
Key takeaways from my latest Messari report
I built a model for $PUMP which places the token at a $7B FDV. But there's one big caveat.
Here's how we did it 🧵👇:
2) Say what you want about memecoins but the sector has continued to print money.
Volumes on the launchpad are down from the start of the year but remains far higher than where it was for most of 2024.
3) People are probably also underestimating how successful PumpSwap has been. Launched just ~3 months ago, the DEX has already taken a chunk out of Raydium's dominance on Solana.
4) Our valuation methodology is top-down and we make assumptions for crypto volumes, Solana dominance, launchpad share and PumpSwap share.
Our assumptions and model are only available to Enterprise customers, but I'll give you the high level takeaway.
5) In our base case, we think memecoins carve out a niche within the broader cryptoeconomy, as it is far better suited for facilitating speculation than NFTs.
This can happen even as Solana undoubtedly diversifies into new asset pairs as its ecosystem matures.
6) We think pump can still put out ~$675M in revenue in two years as retains slightly lower share within Solana and PumpSwap continues to grow.
With a 10x multiple that's around $7B FDV in our base case.
7) However, if pump decides to pursue an opaque token/equity structure which sends the majority of revenues to insiders instead of to tokenholders, we believe the market is currently too skeptical to overlook poor value accrual.
8) In our full report, we provide valuation tables to assess what $PUMP might be worth based on what % of revenues tokenholders can access.
We also have our bear and bull case breakdowns in there.
Check it out here:
9) No matter what the market decides, this is an incredible opportunity to own a part of the most profitable crypto application of all time.
Let's just see whether the team gives tokenholders enough buy-in to make it investable.
@matrixthesun I think they’d rather spend the money to vertically integrate up the Solana stack. Maybe build an aggregator or trading bot to capture all the value that comes from their graduated tokens.
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