Private sale investors of the Pump.fun (PUMP) memecoin began offloading billions of tokens to exchanges, raising concerns of a sell-off as the token dropped below its initial sale value.
Blockchain analytics firm Lookonchain flagged that two early backers of the memecoin token, labeled in Solscan as “PUMP Top Fund 1” and “PUMP Top Fund 2,” collectively sent over $160 million in PUMP tokens to centralized exchanges.
During the private sale, the Top Fund 1 wallet acquired 25 billion tokens for $100 million in USDC (USDC). In the last week, the wallet deposited 17 billion tokens worth almost $90 million to exchanges. While the whale started offloading, it still holds tokens worth $29.5 million.
The second wallet bought 12.5 billion tokens for $50 million during the private sale, and offloaded the entire stash worth over $71 million to exchanges.
Pump.fun token drops as presale participants offload tokens
While the PUMP token showed bullish signs immediately after its launch, it also began to display the effects of a high unlock percentage.
CoinGecko data shows that in the last seven days, the token’s value decreased to an all-time low of $0.003642 on Friday. This represents a 46.5% drop from its all-time high of 0.006812 and a 32% decrease since its launch on July 15.
Its current price point also shows a 7% decrease compared to its initial coin offering (ICO) price of $0.004. This means that presale investors who haven’t sold their tokens are facing unrealized losses.
On July 13, Pump.fun raised almost $500 million from its initial coin offering of the PUMP token, selling out in 12 minutes. However, some participants seemed eager to offload their tokens after the ICO.
On Thursday, BitMEX shared onchain data showing that nearly 60% of PUMP presale participants sold or transferred their tokens to exchanges or other wallets. At the time, 37.4% of the presale participants held onto their tokens, while 3% continued to increase their holdings.
BitMEX analysts said PUMP’s appreciation post-launch defied expectations because of its high unlock percentage during launch. BitMEX said large floats often lead to strong downward pressure in derivatives markets.
Related: Pump.fun buys Kolscan in first acquisition, eyes gamified trading
Memecoin sector surges to $87 billion on July 21
Meanwhile, the broader memecoin sector has begun to show signs of slowing. CoinMarketCap data shows that the overall market capitalization for memecoins peaked at $87 billion on Monday, up 58% from its value of $55 billion on June 30.
This was followed by a quick drop to a low of $81 billion on Tuesday. At the time of writing, the memecoin sector’s market cap is at $82 billion, according to CoinMarketCap.
Anthony Anzalone, the founder and CEO of the layer-1 blockchain network Xion, previously told Cointelegraph that the increase in the memecoin market cap showed that capital doesn’t have anywhere better to flow.
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