The Rise of Income Capture Models: From the Pump.Fun Craze to Hyperliquid's Buyback Mechanism

Recently, the cryptocurrency market has witnessed a significant shift in the value of tokens. From pure meme coins to projects with actual revenue capture mechanisms, the preferences of investors and users are undergoing notable changes. This article will explore this trend and analyze its impact on cryptocurrency investment.

The Success of Pump.Fun and the Challenges from Imitators

The explosive success of Pump.Fun proves the strong demand in the market for tokenized assets. It provides users with a simple platform to easily tokenize various concepts and use them in different scenarios. Despite multiple platforms attempting to replicate its success, Pump.Fun still maintains its market leadership.

However, some emerging platforms are trying to innovate, such as allowing token holders to share in the platform's profits. The tokenomics of these projects are more complex, attempting to find a balance between pure meme coins and tokens backed by actual value.

The Decline of Pure Meme Coins

The market is gradually moving away from pure meme coins. Although there are occasional meme coins that experience rapid growth without any real value support, such cases are becoming increasingly rare. Investors and users are now more inclined towards project tokens that can provide real value.

With the gradual clarification of the regulatory environment, projects that cannot demonstrate long-term value will find it difficult to attract investors. Currently, the two most popular token value feedback mechanisms in the market are:

1. Repurchase Mechanism
2. Fee Distribution

Among them, the buyback mechanism is favored for directly using project revenue to support token value.

Hyperliquid Case Study

Hyperliquid's buyback mechanism demonstrates how to effectively convert project revenues into token value. Although there are concerns that high-position buybacks may lead to capital waste, actual analysis shows that as long as the income is real and sustained, using it for buybacks can establish strong market confidence.

This mechanism not only provides strong support for the token price but also creates a positive feedback loop. Users enjoy using the product, trading volume continues to rise, market share keeps expanding, and the buyback directly returns these achievements to the token holders.

New Logic of Crypto Investment

The current cryptocurrency market has entered a "hard mode". Projects can no longer succeed merely based on brand effects or short-term hype; they must demonstrate real product value, stable sources of income, and a continuously growing user base.

Investors are refocusing on projects that can retain users on-chain and establish self-sovereignty of assets. This includes applications that are closely tied to the real world, such as sports-related NFT platforms and prediction markets.

Criticism of Infrastructure Investment

The fund strategy that purely invests in infrastructure has come under scrutiny. Some funds have been accused of using infrastructure projects as arbitrage tools, seeking to exit before token listings, which could harm the long-term development of the industry.

Lessons from Venture Capital

In the cryptocurrency field, the capabilities of individuals and teams are more important than any other factor. Successful projects are often able to quickly adjust their direction based on market changes. However, the spirit of contract in this industry is generally weak, and investors need to be prepared to cope with unexpected situations.

The high volatility of the crypto market means that extreme profit paths may occur, but there are also many cases of failure. Investors need to learn emotional management and adopt long-term investment strategies.

Overall, the cryptocurrency market is undergoing a significant transformation period. Projects that can provide real value and effectively capture revenue will stand out in future competition. Both investors and users need to adapt to this new paradigm and reassess their understanding and expectations of token value.