Original author: Ma He, Foresight News
On July 21, Pump.fun officially launched the BOOST mode, establishing it as the standard default launch mechanism for new tokens. Following the announcement, the PUMP price continued to fluctuate around $0.002.
According to official documentation, historical data shows that when 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 their tokens, this portion of funds remains permanently locked in the LP and can no longer be effectively utilized. The platform estimates that this mechanism results in over $100 million in permanent liquidity loss annually.
The core action of the BOOST mode is straightforward: during the first 5 minutes after token migration, continuously buy the token using TWAP (Time-Weighted Average Price) with funds that would otherwise be wasted, and immediately destroy all purchased tokens. Upon the token’s graduation, Pump.fun forcibly retains approximately 20% of these funds. Based on the fixed migration rules, the SOL pair retains 17.6 SOL, and the USDC pair retains approximately $2,516.
These funds all come from the liquidity "sacrificed" during the previous migration, not from new platform subsidies. After the purchase is completed, the corresponding tokens are directly burned, creating short-term buying pressure while permanently reducing the circulating supply.
Use reserves to provide 5 minutes of buy support for the token.
The classic Pump.fun workflow is: users create a token with one click, then trade it on a bonding curve; once the token reaches a certain market cap threshold, it automatically migrates to a PumpSwap liquidity pool. During migration, the platform locks a predetermined portion of liquidity into the LP to ensure ongoing trading depth.
The issue is that a high proportion of these locked funds remains tied up. Even if the token’s price later drops to zero and everyone exits, a sum of “dead money” will still remain in the liquidity pool. This money cannot be withdrawn or reallocated to other active assets, resulting in systemic capital waste. The official estimate puts this at “over $100 million per year.”
The BOOST mode does not alter the trading experience on the bonding curve or adjust the graduation threshold itself. It does not create or release any external liquidity out of thin air. Instead, it redirects the 20% of settlement funds originally intended for LP injection to purchase and immediately burn tokens on the secondary market over a 5-minute window using TWAP.
The official statement clearly indicates that tokens migrated from Pump.fun after 22:23 Beijing Time on July 21 will automatically have BOOST enabled. Tokens migrated prior to this time, as well as tokens launched via the Mayhem (AI Agent Lab) mode, are not eligible for this mechanism.
First 5 minutes of fireworks
As of July 22, Pump.fund's annualized revenue is approximately $342.54 million, and the total value of repurchased tokens is around $411.27 million; however, its token price remains far below its peak of $0.008. Large-scale buybacks alone are no longer sufficient to effectively boost price expectations.
The essence of BOOST is not to add another round of buybacks for PUMP, but to address the product issues of the launchpad itself.
The underlying logic might be this: if post-graduation meme coins had slightly deeper order books and slightly better short-term performance, traders would be more likely to stay and repurchase. Most PVP players don’t care what happens to a meme coin three days later—they only care whether it “pumps” at the moment of graduation. Pump.fun’s team may have recognized this: instead of locking 20% of funds permanently in the LP pool for defense, it’s better to turn that money into a “firework” during the first five minutes.
The platform's true moat isn't "the volume of tokens issued," but rather "the proportion of issued tokens that consistently generate trading volume." Only when the latter is stabilized can protocol revenue become truly sustainable. With stable or growing revenue, buybacks have lasting momentum—not merely appearing as an attempt to propping up prices with existing income.
Of course, some traders are concerned that additional buying pressure lowers the actual difficulty of launching a project, making it easier for low-quality tokens to appear successful and thereby encouraging more aggressive launch behaviors. Others point out that the 5-minute TWAP buying window is still too short; once buying stops after 5 minutes and large sell orders hit, the token price could crash with even more extreme slippage than before. This essentially trades an extremely high risk of massive post-launch dumping for the illusion of a strong first 5 minutes.