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Jupiter, the leading DEX aggregator on Solana, will vote on an excess of 215M JUP tokens. The assets from a previous airdrop make up around 6% of the circulating JUP supply and raise the question of pressuring the market.
Jupiter DEX is preparing to vote on the usage of the additional JUP tokens left after this year’s airdrop event. After the Jupuary farming session and airdrop, the project had upward of 215K JUP tokens in its reserves.
An exact amount of 215,461,850.21 JUP allocations remained unclaimed, due to compromised wallets or skipped claims during the airdrop window. Jupiter will hold a vote as part of its approach to include the community in key decisions.
JUP active staking boosts community engagement
Earlier, the project’s lead developer, @weremeow, suggested the excess tokens may be used for Active Staking Rewards. That way, the tokens would still be distributed, but over a longer time. ASR tokens will also initially decrease the JUP in circulation, by encouraging more staking. Active staking is the main voting mechanism for the project.
The ASR program is efficient in distributing JUP, so far spreading more than 361M tokens. Using the JUP tokens as ASR will distribute the amount over the course of a year.
The goal of ASR is to encourage not only holding JUP but to boost discussions. Jupiter has held more than 12 votes on various issues over the course of six months. The Jupiter team has also stated ASR is the preferred usage for the excess tokens as a tool for community engagement. Jupiter puts out a vote for multiple products and developments, which gives the JUP token additional utility.
The current initial proposal also includes the option to immediately burn the tokens, causing some deflation. The third possibility is to return them to the community multi-sig wallet. In the wallet, the JUP will be held in cold storage and claim passive staking rewards.
The final proposal will be open from Friday onward, and voting will start on September 27. The community discussion suggests a favor for the first option, with others in support of burning the tokens.
JUP token waits for a breakout
The native JUP token aims to recover its one-month peak. In the past weeks, JUP bounced from its lows and regained the $0.87 level. JUP breaking above $0.90 is seen as the precursor of a bigger rally. In the short term, JUP is expected to reclaim the $2 level, possibly with a rally in October.
The JUP tokenomics includes a series of unlocks that may affect the asset price. JUP retains 34.22% of unlocked tokens, expecting accelerated inflows from 2025 onward. The team allocation will start unlocking in January, along with early Mercurial ecosystem stakeholders. The Jupiter project has allocated 50% of the tokens to the community, as a way to split trading rewards.
JUP benefits from the growing influence of Jupiter. The aggregator also locks in $1.95B in value, and has risen to become the third-largest DeFi entity on Solana. The aggregator has more than 198K users, performing up to 80K daily swaps. Jupiter increases the chance of including the trade in a Solana block. However, up to 61% of swap attempts can fail due to Solana’s transaction overload and fee requirements.
Jupiter brings dynamic slippage, DCA tools
Trading meme tokens on Solana means facing the potential for slippage. Jupiter’s aggregator automated trading with dynamic slippage tools, allowing users to trade seamlessly while optimizing fees.
Jupiter will propose simulated slippage, to suggest a better trading strategy. The system is still in progress and may perform with higher-than-expected slippage in reality.
The Jupiter aggregator can also perform split trading transactions, similar to Ethereum’s CoW protocol. The DCA buying tool splits each order to avoid slippage, turning it into a series of trades with a predetermined frequency.
Solscan will also display Jupiter’s DCA transactions to avoid confusion with small trade reporting. The DCA tool aims for lower risk and slippage. The effect of the new feature is already seen in a recent activity spike. The ability to buy through DCA increased the activity of traders with under $100 in weekly volume.
Cryptopolitan reporting by Hristina Vasileva