PumpBTC (PUMP) crashed by 45% after Binance Wallet TGE

PumpBTC (PUMP) is the next token to react negatively to being featured on Binance Wallet. PUMP lost credibility and wiped out 45% in a day after panicked trading. 

PumpBTC (PUMP), a Bitcoin-based DeFi project, crashed by 45% on Wednesday. The crash started on April 22, just days after PUMP was featured as the next Binance Wallet TGE. PUMP was featured on April 12 as the next perpetual futures asset. The token also has a lively spot market on Bithumb and Bybit.

PumpBTC crashes through the floor

PUMP crashed from a recent all-time high of $0.22 down to $0.10, sparking a significant loss of credibility. Open interest also crashed by 54% down to only $12M.

The event follows the recent crash of Mantra (OM), which also came with accusations of artificially pumping the token.

PumpBTC showed the crypto market was still capable of hyping VC-backed projects, but this time with a much shorter lifespan before the crash. PUMP is still in its early days of price discovery, but the panic selling and low liquidity may damage the project’s reputation. 

This time, the most probable reason for the crash was the recent Bithumb listing. The token’s expanded volumes may have given early adopters enough exit liquidity to sell, but this also turned into panic-trading and a deeper market crash. PUMP extended its slide just as the rest of the crypto market was recovering. 

PUMP, launched in early April, has been mostly climbing in the past days, creating outsized hype. The asset relied on Bybit and Gate IO listings and hopes of being added to Binance. 

PumpBTC held a high-profile IDO

The chief reason for selling PUMP is that the current price is extremely beneficial for early investors. PumpBTC performed an IDO through Binance Wallet, aimed at distributing 5% of the token’s supply. Buyers on BNB Smart Chain had the chance to acquire PUMP at $0.015, with the chance to sell after the first days of price discovery. 

Binance Wallet capped the sale at $750,000 paid in BNB, for a total of 50M PUMP tokens. The sale of 5% of the PumpBTC supply was more of a marketing ploy to draw attention to the project, as each IDO buyer was limited to 3 BNB for their total purchase. 

The PUMP IDO did not create whales, but the project also had early backers for its seed round from October 2024. PumpBTC raised $10M in its seed round, distributing most of its tokens at a much lower price to early contributors. The VC backing came from various funds, including Mirana Ventures and Mantle. 

Those early contributors and investors had relatively large claims and may add selling pressure to the asset for the long term. Another 2.98M PUMP was distributed through Binance’s Launchpool program. 

Only 29.2% of PUMP remains to be unlocked, with most categories of owners already controlling their tokens and potentially searching for exit liquidity. Additional linear unlocks will slowly inflate the supply of PUMP up to 1B tokens in circulation.