Hyperliquid, Pump.fun account for nearly 90% of record $638M crypto buybacks: FT

The crypto industry has a long history of being allergic to real revenue. For years, the play was simple: raise money on a vision, launch a token with no utility, and hope the market keeps the price up through pure speculation. But the tide is finally turning toward something that actually looks like a business. New data shows that crypto projects have spent a record $638 million on token buybacks so far in 2024, and two specific names are doing the heavy lifting: Hyperliquid and Pump.fun.

The Shift From Printing to Buying

In traditional finance, a buyback is a sign of maturity. It means a company has extra cash and believes its own stock is undervalued. In crypto, buybacks have historically been seen as a gimmick or a way to artificially prop up a dying project. What we are seeing now is different. These are not projects spending their treasury reserves to save a sinking ship; these are protocols using actual generated fees to reward their holders.

Hyperliquid and Pump.fun alone account for nearly 90% of that $638 million figure. That is a staggering concentration of capital. It tells us that while thousands of protocols are launching every day, only a tiny handful are actually making enough money to matter. For founders, this is the reality check: the era of "build it and they will come" is over. The era of "build it and make it pay for itself" is here.

Why Pump.fun and Hyperliquid are Leading

Hyperliquid has found a groove in the decentralized perpetuals space. They built a high-performance chain that actually works, and they are capturing the volume that used to live exclusively on centralized exchanges. Pump.fun, on the other hand, captured the cultural zeitgeist of the memecoin craze. Whether you like the product or not, the revenue numbers are undeniable. They solved the friction of launching a token, and they are taxing every step of that process.

These projects aren't just successful; they are efficient. They have small teams, high automated throughput, and a clear mechanism for funneling user fees back into the ecosystem. This is the blueprint for the next generation of builders. If your protocol doesn't have a way to turn activity into capital, you aren't building a business—you're building a charity.

What This Means for Builders

If you are a founder in the crypto or AI space right now, you need to be looking at these buyback numbers with a healthy dose of skepticism and a lot of focus. Here is what this trend actually tells us:

• Revenue is the new TVL: Total Value Locked used to be the metric everyone obsessed over. It was easily manipulated and often meant nothing. Now, the market is looking at fee generation. If you can't show a path to revenue, you won't get the same valuation multiples as the projects that can.
• Capital efficiency wins: You don't need a team of 100 people to generate hundreds of millions in revenue. Both Hyperliquid and Pump.fun operate with lean structures. In crypto, scale comes from code, not headcount.
• Regulatory clarity is the elephant in the room: Buybacks look a lot like dividends. While this is great for token holders, it puts these projects directly in the crosshairs of regulators who view these as securities. Builders need to be careful how they structure these mechanisms to avoid the "security" label while still providing value.

The Risk of the Buyback Model

We shouldn't just celebrate the $638 million number without questioning the sustainability. Buybacks are great when the market is up and fees are flowing. But what happens during a multi-year bear market? If a project ties its entire value proposition to its ability to buy back tokens, it becomes extremely vulnerable when activity dries up.

A healthy project should be reinvesting a portion of those fees into R&D and ecosystem growth, not just price support. The concern with the current trend is that projects might be over-indexing on short-term price action to keep their communities happy, rather than building long-term defensive moats.

The Founder's Takeaway

The record buyback figures are a signal that the market is maturing, but the concentration of that wealth is a warning. Only the top 1% of protocols are currently generating meaningful revenue. As a builder, your goal shouldn't be to launch a token; it should be to build a fee-generating engine that users actually want to pay for.

The market is tired of empty promises and inflationary tokens. We are moving toward a 'show me the money' phase where the only thing that counts is a protocol's ability to capture and distribute value.

If you are building in AI or crypto, ask yourself: would my project survive if we couldn't issue new tokens for five years? If the answer is no, you need to rethink your revenue model. Hyperliquid and Pump.fun have set a new bar for what a successful crypto business looks like. It’s loud, it’s aggressive, and it’s backed by cold, hard cash.

Read the original at Cointelegraph →