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Jupiter, the leading Solana DEX aggregator, is now taking up to 80% of the network’s priority fees through its validator, JupSOL. Jupiter aims to grow into a more competitive Solana app, while hosting a wider selection of trades.
The DEX aggregator Jupiter is growing by months, expanding its influence on the Solana network. With more trades going through Jupiter, the DEX aggregator marks a noted increase in priority fees. JupSOL now surpassed the previous winner, Jito, by attracting more SOL fees. This also means JupSOL will pay out better rewards for delegating SOL.
Jupiter now accounts for as much as 80% of Solana’s priority fees, as meme token trading becomes more competitive. The share of Jupiter transactions expanded in the past months, when Jupiter still accounted for 50% of priority fees in May. The JupSOL validator helps the smoother running of the Jupiter DEX aggregator. Additionally, the validator invites staking SOL, with increased earnings based on DEX activity.
80% of Solana's Block Rewards / Priority Fees now go to JupSOL.
This is increased from 50% in the past.
JupSOL:https://t.co/Er9qABe6l8
— Jupiter 🪐 (@JupiterExchange) July 22, 2024
The JupSOL priority fees are closely tied to the Jupiter activity. Priority rates paid for Solana DeFi protocols also vary by the hour. Priority transactions are still somewhat random on Solana, expecting further updates to fix the problem.
The need to pay priority transactions on Jupiter is partially due to the high rate of failed transfers. During some periods, Jupiter DEX transactions fail in 90% of the cases. Priority fees on Solana retain a degree of randomness and do not guarantee the inclusion of a transaction into a block.
Since May, Solana validators also receive 100% of all priority fees, with no forms of sharing. Solana validators are still in heavy competition for staking SOL and receiving fees. JupSOL is still a relatively small validator, with a focus on serving the native Jupiter project.
Jupiter still aggregates about $543M in value, and is the sixth more active chain on Solana. In the past month, Jupiter grew its value locked by 30%, but is still far from Raydium’s $1.9B in value. Despite this, Jupiter is key for aggregating token data and launching trades on Solana.
Also Read: Jupiter DEX proposes an “everything market” on the Solana platform
As of July 23, Jupiter 6 and Jupiter 4 collected a large part of priority fees, becoming one of the top DeFi projects on Solana. Jupiter still competes with the likes of Raydium, Orca and Phoenix. At the same time, Jupiter combines traffic from both Raydium and Orca, while also tracking newly launched meme assets. Jupiter itself does not draw in liquidity pools, hence the lower value locked.
Jupiter introduced its Global Priority Fee upgrade in February, where users could see a transparent estimation of fees to pay across all products. Priority fees still mean the transaction will be sent to a public pool and is still open to attacks from MEV bots. Jupiter also carries Jito fees, where transactions are sent to a validator directly.
Jupiter looks at meme launchpad experiment
The Jupiter DEX is one of the most dynamic Solana projects, headed by lead developer @weremeow. For that reason, Jupiter branches beyond its main product, and has announced an upcoming meme launch platform. If this product is realized, Jupiter will also become a competitor to the likes of Raydium and PumpFun.
The recent announcement of a meme launch platform has also created some controversy. The plan includes a partnership with influencer Irene Zhao, known for previous token, DAO and NFT launches, most of which ended up in losses and suspected rug pulls. Since one of the goals of Jupiter is to achieve a community-first profit-sharing scheme, the inclusion of Zhao was worrying.
Also Read: Jupiter DEX aggregator implements Solana’s Blinks, offering swaps through any link
On Jupiter’s Discord, @weremeow stated Zhao would serve as a high-profile tester for the platform, while protecting investors as much as possible. As an incentive, the Jupiter DAO would receive a share of the meme launch platform’s revenues.
Despite this, the Jupiter launch mechanism is also expected to attract a new community of users and offer transparency in selecting tokens with the smallest possible risk.
Following the news, the native JUP token sank to $0.93 after reaching a one-month high of $1.03. The JUP token performed one of its biggest airdrops in the industry, offering both direct gains and staking opportunities. As of July 23, early airdrop receivers have another nine days left to claim their JUP tokens from the January airdrop.
Cryptopolitan reporting by Hristina Vasileva