Pump.fun made a significant announcement on May 12, introducing its "Creator Revenue Sharing" program. The platform promised to share 50% of its total revenue with token creators, sparking immediate interest across the crypto community. However, a detailed examination shows that the reality is more complex and less generous than it first appeared.
Understanding the New Fee Structure
Originally, Pump.fun applied a simple 0.25% fee on every transaction. Out of this, 0.2% went to liquidity providers, and the protocol kept the remaining 0.05%. With the new revenue-sharing model, an extra 0.05% fee was introduced, raising the total transaction cost to 0.3%.
This means that the creators' share did not come from Pump.fun's existing revenue pool. Instead, it was funded through an additional fee charged directly to users.
Community Backlash and Rug Pull Concerns
The change in fee structure was met with swift criticism, especially on social media platforms like X. Many community members expressed worries that the new model could unintentionally reward malicious behavior.
A major concern was the potential encouragement of "rug pulls," where developers abandon a project but continue to earn fees from ongoing token transactions. This model might reduce the incentive for creators to maintain or support their tokens after launch, ultimately harming investors and community-led revival efforts.
Data-Driven Look at Creator Earnings
To assess the real impact of the revenue-sharing program, we analyzed on-chain data starting from May 12.
Early Performance and Peak Revenue
On the first day, creator earnings were below $20,000. However, revenue grew rapidly, eventually surpassing $200,000 per day at its peak. During this high point, creator earnings made up about 12% of Pump.fun’s total daily fees.
After May 22, trading volume declined, and creator earnings followed suit. Recently, daily earnings have stabilized at approximately $130,000.
Total Revenue Comparison
Between May 12 and the time of analysis, creators earned a combined total of over $3.07 million. In the same period, Pump.fun generated more than $4.4 million in revenue—about 43% higher than what was shared with creators.
Liquidity providers were the biggest beneficiaries, earning over $17.7 million, far exceeding both creators and the platform itself.
How Earnings Were Distributed Among Creators
A total of 3,566 creators participated in the revenue-sharing program. The distribution of earnings was highly unequal:
- 34.9% earned less than $100.
- 48.5% earned between $100 and $1,000.
- 13.7% earned between $1,000 and $5,000.
- 1.8% earned between $5,000 and $10,000.
- Just 0.1% earned more than $50,000.
This means that more than 83% of creators earned less than $1,000 each.
Disparity Among Top Earners
The inequality is even more evident among the highest-earning creators:
- The top earner (address: 547L…w3rE) made over $104,000 from only three tokens.
- The tenth-highest earner (address: 7Lsg…gmyv) earned around $25,000—just a quarter of the top creator’s revenue.
Quality vs. Quantity in Token Launches
Among the top 100 earners, two distinct strategies emerged:
- 43% launched five or fewer tokens, with 26 creators launching only one token.
- 19% launched more than 1,000 tokens each.
The average number of tokens created by the top 100 earners was 1,626, but the median was just 10. This indicates that some creators focused on launching a high volume of tokens to maximize earnings, while others prioritized fewer, possibly higher-quality offerings.
Key Takeaways and Implications
Pump.fun’s Creator Revenue Sharing model introduced a new dynamic in the decentralized finance (DeFi) space. While it aimed to reward creators, the implementation revealed several challenges:
- The additional fee was ultimately paid by users, not absorbed by the platform.
- The uneven distribution of earnings favored a small number of top creators.
- There are valid concerns about whether the model incentivizes rug pulls over sustainable project development.
Transparency and clear communication are essential in DeFi initiatives. As the industry evolves, projects must balance incentive structures with long-term trust and community health.
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Frequently Asked Questions
What is Pump.fun’s Creator Revenue Sharing program?
It is an initiative where Pump.fun shares a portion of its transaction fees with creators of tokens launched on its platform. The program was introduced in May 2024.
How are the earnings distributed among creators?
Earnings are based on the trading volume of each creator’s tokens. However, data shows that the majority of creators earn less than $1,000, with a small percentage earning significantly more.
Does the revenue-sharing model encourage rug pulls?
Some community members believe it might, as creators can earn fees even after abandoning a project. This could reduce incentives for long-term maintenance or support.
Who pays the additional fee used for revenue sharing?
The extra 0.05% fee is paid by users during transactions and is used to fund the creator earnings pool.
How do liquidity providers benefit compared to creators?
Liquidity providers earn a 0.2% fee on every transaction, which has resulted in significantly higher total earnings compared to both creators and the platform.
Can creators with fewer tokens still earn significant revenue?
Yes, some top earners launched very few tokens, suggesting that quality and trading volume matter more than quantity for earning potential.