When buybacks are smaller than unlocks, price support hinges on one key metric: the Net Flow Efficiency Ratio (NFER)—the ratio of buyback capital velocity to token unlock/inflation velocity. If NFER < 1.0, buyback funds act only as a cushion and may even accelerate whale selling. How strong price support remains depends on the size of this gap and whether the buyback is truly reducing circulating supply.
Step 1: Get Two Key Numbers – Buyback Amount and Unlock Amount
First, lay out the project's recent buyback and unlock volumes side by side.
What to do: On Dune Analytics, Token Unlocks or official project announcements, find the token's daily/monthly buyback amount and the unlock amount for the same period.
How to do it: Take Pump.fun as an example. Analysts estimate that if all daily PUMP unlocks are sold (worst case), the selling pressure is about $484,000 per day, while daily buyback revenue is about $700,000. That means, in the most conservative scenario, the buyback amount is roughly 1.45 times the unlock amount—requiring a price increase of about 45% just to break even. Conversely, if the buyback amount is clearly smaller than the unlock volume, the price will be continuously weighed down by new supply.
Completion standard: You get the token's "buyback/unlock" ratio and know whether the current gap is positive or negative.
Step 2: Calculate Net Supply Change – Is the Buyback Really Shrinking Circulation?
A big buyback number does not mean circulating supply is decreasing. You need to see whether tokens are burned, locked, or just moved elsewhere.
What to do: Check where the bought-back tokens end up.
How to do it: According to public data, among 11 tokens with buyback mechanisms, only BNB (‑4.5%) and RAY (‑6.8%) are truly heading toward a supply decrease over the next 12 months. PUMP burns about 26 billion tokens per year, but unlocks around 82 billion, so net supply still grows by ~14.2%. Hyperliquid has huge buybacks, but unlocks add ~119 million tokens while buyback burns only ~14 million, resulting in ~47.1% net supply growth.
Completion standard: You confirm whether the token's net supply is truly deflationary or still inflationary.
Step 3: Link Net Flow to Price Performance
The net supply gap directly determines the strength of price support.
Case A: NFER > 1.0 (buyback > unlock) – Strong price support, rally conditions exist. In the 2025 buyback market, only a few projects like Hyperliquid and Aave achieved NFER > 1.0 price elasticity. Even so, Hyperliquid still faces about 47% net supply growth pressure.
Case B: NFER < 0.1 (buyback far less than unlock) – Buyback is almost useless. Jupiter's buyback covers only 6% of selling pressure (NFER ≈ 0.06), and its price crashed 89%. This kind of buyback is a drop in the bucket.
Case C: 0.1 < NFER < 1.0 – Buyback cushions but cannot stop the sell‑off. PUMP's monthly buyback is about 5 billion tokens, but this unlock of 89 billion tokens is 18× the monthly buyback rate. No matter how large the buyback, when the scale of unlocks is completely mismatched, it merely delays the inevitable.
Common Mistake
Looking only at the buyback dollar figure while ignoring the unlock scale. Pump.fun bought back over $138 million worth of tokens, yet the price fell 80% from its ATH. The reason: buyback funds became exit liquidity for whales. Without a lock‑up mechanism, pure deflation cannot counter heavy selling. The raw buyback number matters far less than the difference: buyback amount minus unlock amount.
If the buyback amount stays below the unlock volume over the long term and the project shows no sign of adjusting the unlock schedule or increasing buyback intensity, price support will gradually weaken. More importantly, when the market realizes this gap cannot be closed, the expectation itself turns into selling pressure—holders will rush to sell before large unlock events, causing a stampede of front‑running.
How to Verify
For the token you are watching, calculate its current monthly buyback amount divided by its monthly unlock amount. If this ratio stays consistently below 0.5 and the project is not adjusting its mechanism, medium‑to‑long‑term price pressure is very likely, and any short‑term bounce may be a chance to reduce your position.
Next Steps
Add this data to your project watchlist. Pay close attention to the timing of unlock events. If unlocks are concentrated at a specific point (e.g., team cliff ends or investor lockups expire), buyback capacity must significantly increase before that deadline; otherwise, concentrated selling will likely break current support levels.
