Ansem: Why I think token buybacks don't solve any problems?
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Ansem: Why I think token buybacks don't solve any problems?
The buyback mechanism itself does not create value; what truly determines the token trading multiple is the "trust premium" between the team and the community.
Navigating Web3 tides with focused insightsAuthor: Claude, TechFlow
TechFlow Editor's Note: Prominent Solana trader Ansem posted that buyback mechanisms themselves do not create value; what determines the token valuation multiple is the "trust premium" between the team and the community. He compared Hyperliquid (annualized revenue approx. $800 million, FDV approx. $65 billion) and pump.fun (annualized revenue approx. $440 million, FDV only approx. $1.4 billion), pointing out that both are conducting large-scale buybacks, but their valuation multiples differ by nearly 50 times.
One of the crypto market's most enduring narratives is being challenged: pouring protocol revenue into buybacks will cause token prices to rise.
On July 16, prominent Solana trader Ansem (@blknoiz06) published a long post on the X platform, proposing a counterintuitive argument: Buyback mechanisms themselves do not create value; what truly determines the token trading multiple is the "trust premium" between the team and the community. The post quickly garnered over 469,000 views, 3,240 likes, and 509 reposts after publication.
Ansem chose two of the highest-revenue protocols in the crypto industry for comparison. Hyperliquid annualized revenue is approx. $800 million, HYPE's FDV is approx. $65 billion; pump.fun annualized revenue is approx. $440 million, HYPE's FDV is approx. $65 billion; pump.fun annualized revenue is approx. $440 million, HYPE's FDV is approx. $65 billion; pump.fun annualized revenue is approx. $440 million, PUMP's FDV is only approx. $1.4 billion. Both teams are using the vast majority of revenue for buybacks, but the valuation multiples differ by nearly 50 times.
Ansem's conclusion is: the gap lies not in revenue scale, but in the trust accumulated through team behavior.
Both Spending Heavily on Buybacks, Why Are Hyperliquid and pump.fun Valuations So Different
Ansem broke down the buyback strategies of the two platforms in the post.
Hyperliquid directs 97% to 99% of protocol fees directly into HYPE buybacks and burns. According to CryptoNews data, as of June 30, Hyperliquid's cumulative protocol revenue has exceeded $1 billion, with an annualized run rate close to $840 million. The platform has burned over 41 million HYPE tokens, valued at over $1 billion, reducing the circulating supply by approx. 4.2%. As of press time, HYPE is quoted in the $60 to $67 range, with an FDV of approx. $57 billion to $62 billion.
pump.fun is equally aggressive. In 2025, the platform's total revenue was approx. $970 million, investing close to 100% of revenue into PUMP buybacks, cumulatively buying back approx. $213 million. In April 2026, the team burned PUMP tokens valued at $370 million in one go (approx. 36% of circulating supply) and locked 50% of subsequent revenue for continuous burns. However, PUMP is currently quoted at approx. $0.0016, with an FDV of approx. $1.4 to $1.7 billion.
pump.fun's annualized revenue is more than half of Hyperliquid's, but its FDV is less than 3% of Hyperliquid's. If the buyback mechanism were the core driver of valuation, this multiple gap would be unexplainable.
Ansem's Explanation: Trust Premium is the Core of Pricing
Ansem believes that the high valuation the market gives Hyperliquid stems from the trust established by Jeff (Hyperliquid founder) and the team.
He listed several points in the post: Hyperliquid has never overpromised, and the team focuses solely on shipping products; user rewards are distributed strictly according to predetermined on-chain metrics, with no black box operations; the core user base has an extremely high trust rating for Jeff and the team. Ansem stated verbatim that this trust premium is "one of the main reasons why the token trades so well".
Hyperliquid's historical behavior indeed supports this judgment. The project did not accept VC investment, allocating 70% of the total supply to the community; the large-scale airdrop at launch in November 2024 fulfilled early promises; the platform showed resilience during the market sell-off in February 2026, indicating that the user base includes a large number of serious traders relying on the platform for daily trading.
pump.fun's Problem: $1 Billion Revenue, Promised Airdrop Not Delivered for a Year
Ansem's criticism of pump.fun is more direct.
He pointed out that pump.fun has cumulative revenue exceeding $1 billion and raised another $1 billion in its ICO, but the airdrop promised to users has never been delivered. According to Protos, pump.fun explicitly stated "airdrop coming soon" when announcing the PUMP token ICO on July 9, 2025, promising to allocate 24% of the supply to the community. As of mid-July 2026, a full year has passed since this promise, and the airdrop has still not materialized.
Ansem had publicly criticized this point previously on June 25: "pump.fun is the only application in the crypto industry that has sustained attention for several years continuously, even OpenSea hasn't achieved that. But people are angry because they promised a 24% airdrop but never delivered, and now they are just sitting on cash."
The $370 million token burn in April 2026 was intended to repair trust, but the community reaction was counterproductive. Some users believed that these burned tokens should have been used for airdrop distribution, and burning them equated to directly eliminating the share deserved by the community. According to Cryptopolitan, the community's general interpretation of this move was "deepening distrust".
In the latest post, Ansem made a hypothesis: if pump.fun seriously fulfills the airdrop promise and responds to the concerns of core users, the token price could rise 10 to 15 times, while trading volume, attention, and platform revenue would also substantially increase.
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