Jupiter is about to launch its coin, and this article comprehensively analyzes its products and business model

By Paul Timofeev

Compiled by: Xiaobai Navigation coderworld

Solana’s resurgence

Solana is a Proof-of-Stake (PoS) Layer 1Blockchain, which is optimized for high performance and throughput to provide fast execution speeds and low transaction costs. Its unique architecture is significantly different from the EVM chain, allowing developers to focus on building plug-and-play applications with Rust. Solana currently supports 121 protocols in its ecosystem, maintained by 2,156 validator nodes (second only to Ethereum), and is in variousBlockchainThe total value locked (TVL) in DeFi ranks fifth, reaching US$1.38 billion.

Solana has faced and overcome many challenges in its short but eventful history, such as network instability and dangerous relationships with SBF and Alameda, which led to a large loss of users, developers, and liquidity. Despite this, co-founder Anatoly Yakovenko has worked closely with users and developers.CommunityConnecting together, remaining positive and forward-thinking even at their lowest point, demonstrates Solana’s resilience and willingness to adapt and overcome adversity.

In 2023, as the price of Bitcoin rose around the expectation of the SEC's approval of the spot ETF, the crypto market finally rebounded after a long period of sideways trading. The price of $SOL followed closely, rising from $9.98 on January 1, 2023 to $101.51 on January 1, 2024, with a return rate of 917.134%. As SOL gradually continued to maintain a strong upward momentum in the market, MadLads minting went online, and the team announced a points plan and airdrop, an emerging narrative around the unique architectural design of "applications that can only be built on Solana" began to attract the attention of users, investors, and developers.

Solana DeFi Performance in 2023

Solana saw significant growth in both TVL and on-chain transaction metrics between January 1, 2023 and January 1, 2024. This period marked an important stage in Solana’s development, with transaction value and volume increasing significantly despite a drop in TVL following the FTX debacle.

Key Highlights:

• TVL Growth: Solana’s TVL grew from $210.08 million to approximately $1.47 billion, an increase of 5,74%.

• Total swaps: 314,556,244 swaps were performed on the network.

• Total Trading Volume: The total trading volume of the platform reached 420,366,925,06 USD.

Solana’s DEX monthly trading volume reached $23.8 billion in December, setting a new annual high in 2023.

Jupiter Introduction

Jupiter was launched in September 2021 as a DEX aggregator on Solana, aiming to provide Solana users with a better trading experience by delivering liquidity from multiple sources (rather than a single source). Although Jupiter started out as just an exchange engine, the protocol has evolved into an important liquidity layer for multiple different products for different users and has become a key component of the Solana ecosystem.

Jupiter's business model is driven by three core pillars:

1. Provide the best user experience

2. Maximizing the Potential of Solana’s Technical Capabilities

3. Improving Solana’s overall liquidity

2023 is a busy year for the Jupiter team, with the launch of several new core products, including new DCA functionality, limit orders, and perpetuals.contractThere have also been a number of upgrades and optimizations within the core protocol, including an upgraded algorithm (Metis), a bridge comparison tool, instant staked SOL > SOL swaps, and more development tools including the release of the Jupiter terminal and two major API upgrades.

Jupiter 2023 Trading Volume Review

Jupiter’s total trading volume reached $62,816,562,781, accounting for approximately 60% of all Solana DEX trading volume.

Jupiter's monthly volume grew from $6,4925,8200.00 in January 2023 to $7,106,000,000.00 in December 2023, an increase of 994.48%. After Breakpoint announced $JUP, November's volume exceeded $16 billion, setting a new all-time high for monthly volume. Even more impressive is that this increase in volume (mostly in the fourth quarter) came primarily from organic trading activity.

In this report, we will analyze Jupiter's product pipeline and future plans, and explain the logic behind our investment approach.

AMMs and Aggregators

Automated market makers are a novel innovation in the digital asset space over the past few years.exchangeOn exchanges such as Coinbase or Binance, third-party entities operate to provide liquidity so that traders have a counterparty, which is the other side of the trade. These counterparties are called market makers because they “create” a market for traders to trade in, while charging a spread (fee) on each trade to remain profitable.

随着AMM的出现，交易者可以部署由数学和代码而不是复杂的中间商制造市场的数字资产。通过使用AMM，即使在极低流动性的情况下，交易者也可以进出头寸。低流动性的一个缺点是交易者会遇到滑点，即预期交易价值与实现交易价值之间的差额。交易者还可能通过公共mempool中信息不对称的利用而在交易中损失价值，例如被部署MEV机器人的复杂参与者抢跑或夹击。

On-chain aggregators emerged to mitigate the impact of low liquidity trading, allowing traders to place orders and pass liquidity from multiple sources instead of just one. Liquidity can be sourced from a variety of sources, including AMMs; although some teams have built solutions that enable market makers to tap into off-chain liquidity (i.e. CEX positions) and help settle trades.

The main benefit of this is better pricing because:

• Transfers within CEX do not incur any gas costs, while on-chain transfers have costs

• Transactions are not affected by MEV withdrawals

Aggregators, in general, aim to provide a better user experience. Large content platforms like Meta or YouTube act as aggregators of content, allowing users to view videos and pictures from many different websites without leaving the interface. Google aggregates information related to your search query from many different websites on the internet to provide the best matches in order of relevance. Similarly, Jupiter and other DEX aggregators source liquidity across multiple trading venues to provide traders with better trading prices.

SVM-based construction

To better understand Jupiter as a protocol, it is important to understand the role of the Solana Virtual Machine (SVM) and how it influences the protocol design choices that developers must make.

The virtual machine can be best described as a single entity maintained by thousands of networked computers running validating clients for a particular chain (such as Ethereum).contractThe environment where the blockchain and accounts actually exist. Until today, most DeFi and other on-chain activities are conducted through the Ethereum Virtual Machine (EVM). However, although no longer in the spotlight, we believe that the SVM also has a strong architecture that will surely continue to attract more developers seeking to build consumer-facing applications optimized for speed and performance.

Smart contract code written in Rust, C, and C++ is compiled into BPF bytecode by SVM. The Sealevel engine is a key component for implementing parallel processing on Solana; with the integration of state access lists in Solana transactions (transactions contain details of specific states to access), this allows non-conflicting transactions to run simultaneously, resulting in faster overall performance.

While EVM is a "single-threaded" operating environment, meaning it can only process one contract at a time, SVM is multi-threaded and can process more transactions in a shorter time. Each thread contains a queue of transactions waiting to be executed, and transactions are randomly assigned to the queue.

Eclipse and Nitro use SVM to execute L2 The emergence of , shows the potential for further adoption of SVM. Earlier this year, MakerDAO Rune Christensen proposed using the Solana codebase to develop MakerDAO The vision of the application chain has sparked a lot of debate on Twitter.

One of the most common complaints about Ethereum is that gas fees increase as user activity increases, resulting in an unpleasant user experience in most cases, especially during bull markets. No matter how high gas fees are, traders’ needs are simple: get the best quotes possible. Aggregators like 1inch aim to provide users with better prices by pulling liquidity from multiple sources, rather than just one specific DEX. However, trading on Ethereum, such as pulling liquidity from multiple different pools, is an expensive task that may actually worsen the problem it is intended to solve, and trading on Uniswap, which only pulls liquidity from one place, may actually be more beneficial.

Meanwhile, the opposite is true on Solana, where gas costs are less than a penny by default. Pulling liquidity from multiple sources costs almost the same as pulling it from a single source, so DEX aggregators are more practical and beneficial on a chain like Solana than on an EVM chain. As the leading aggregator on Solana, we believe Jupiter is more poised for significant growth and adoption in the long term, while aggregators on EVM chains face higher costs and greater competition.

The same philosophy applies to other use cases beyond simple A-for-B, such as providing users with structured dollar-cost averaging (DCA) or time-weighted average price (TWAP) products, which will be further elaborated below. The basic principle remains that low gas brings great flexibility to application developers on Solana, and Jupiter is a best practice example in this regard.

product description

Jupiter Swap

As with any other decentralized exchange, the most common use cases on Jupiter are simpleToken A andToken B's exchange. Users can exchange their favorite assets at competitive prices. Slippage and priority fee settings are fully customizable, and general settings enable users to choose direct liquidity routing, use wSOL instead of SOL, and use versioned exchanges (which use newer, better routing algorithms).

Developers can also leverage the Swap API to natively integrate Jupiter’s routing algorithm into their dApps. For example, Kamino Finance uses Jupiter’s Swap API to implement features such as unilaterally depositing assets into their CLMM repository (Autoswap).

While we believe continued growth and sustainable adoption of Jupiter and Solana DeFi will prompt the JUP DAO to vote to implement fees at some point in the future, at this time Jupiter does not charge any additional swap protocol fees beyond base gas fees and associated DEX fees. It will be interesting to see how this decision plays out given increased network activity driving higher demand and costs for blockspace, as well as a potential restructuring of the Solana fee market. Currently, the 1inch aggregator on Ethereum does not charge swap fees, while CowSwap recently proposed a fee switch that would charge swap fees with the goal of becoming financially self-sufficient while maintaining user incentives.

Limit Orders

If a trader believes that the price of an asset will change in the near future, they can place a limit order instead of buying the asset at the current market price. A limit order is a signed message with clear trade execution guidelines or "intentions", which provides traders with flexibility, as well as other benefits, such as better protection from slippage caused by MEV.Xiaobai NavigationThis model benefits both retail traders and institutions, and Jupiter now provides a venue for traders to place limit orders on Solana.

When a user places an order to buy $WIF worth 1 SOL, the order is ultimately matched by a keeper, a trusted protocol participant responsible for monitoring prices and executing orders. The keeper functions similarly to a solver on CoWSwap or a filler on UniswapX. Once the order is executed, the specified asset will appear on the user’swalletmiddle.

Jupiter’s limit order functionality provides a wider range ofTokenAs long as there is enough liquidity in the market, the token pair can be traded. In addition, users can specify an expiration time in the order, at which time any outstanding order will be cancelled and refunded to the user.walletmiddle.

DCA

Dollar Cost Averaging (DCA, also known as Direct Investment) is a common investment strategy that involves splitting capital allocation into multiple trades instead of one; this is great for long-term investors who don't care about short-term volatility (e.g., buying $500 of SOL for 5 consecutive days). DCA is very useful when accumulating assets in a bear market, the principle is to average out one's entry price to mitigate volatility and get a greater return over time and changing market conditions. Similarly, DCA can also help profit in a bull market, as instead of selling one's position completely at once, DCA can help spread out sales to capture any additional upside that may occur during the liquidation period, rather than selling the position completely at once.

Traders can also execute a Total Weighted Average Price (TWAP) strategy to buy or sell an asset. Similar to DCA, TWAP is often used for large orders that need to be split into smaller parts to prevent price impact (losing money) from a one-time purchase. Since orders are executed over a period of time, they are similar to the DCA strategy, which is to buy "x" amount within a certain period of time.

Due to Solana’s high-throughput architecture, Jupiter is one of the few platforms that enables users to execute frequent time-limited strategies on-chain. DCA for low timeframe trades on Ethereum (e.g. daily) can result in hundreds of dollars in transaction fees, while on Solana it only costs a few cents. Even onL2On the other hand, if a trader wants to execute 10 trades within an hour, the fees will quickly add up.

Perpetual Contract

To further enrich its wide range of products, Jupiter also launched a perpetual contract for LP-Traders earlier this year.exchangeAlthough still in beta, traders can trade SOL, ETH, and wBTC perpetual contracts with up to 100x leverage, while LPs can provide capital to earn fees.

Perpetual contracts are derivative contracts similar to traditional futures that enable traders to take on larger positions with smaller capital allocations (leverage) in order to take advantage of future price fluctuations.

On Jupiter, traders can open long or short positions on SOL, ETH, and wBTC using nearly any supported Solana token as collateral. Long positions require a corresponding underlying (e.g., a long SOL-USD position requires SOL collateral), while short positions require stablecoins as collateral. Traders can take on leverage by borrowing assets from liquidity pools – a SOL-USD position can be leveraged up to 2x by borrowing 1x SOL from the JLP pool.

与永续合约交易所GMX上的GLP池的动态类似，Jupiter Perps利用了JLP池，该池包括SOL、ETH、WBTC、USDC和USDT。提供流动性只需将任何支持的Solana代币存入JLP池，以换取等值的$JLP代币。 JLP池获得了Jupiter永续合约生成的70%的费用，$JLP的价格与基础池的价值同步增长。

The JLP pool also benefits the greater Solana ecosystem as Jupiter Swap is natively integrated into the perpetual contract exchange, meaning that not only can any token be used as JLP collateral, but Solana traders can benefit from the increased liquidity of the JLP pool and receive better trading prices.

Unlike the aforementioned features, Jupiter's perpetual contract exchange charges more fees to both traders and LPs. Traders pay fees to the pool based on the hourly borrowing fee or funding rate, which is based on the hourly borrowing rate, position size, and token utilization, and can be expressed as:

Funding rate = (borrowed tokens / tokens in the pool) * 0.01% * position size

LPs also need to pay their own portion of fees for opening/closing positions and exchanging different assets within the JLP pool.

Regarding the JLP pool, it should also be noted that given the target ratios set for each token in the pool, any logic that moves the token ratios away from the targets will incur higher fees, while logic that moves the ratios towards the targets will incur fee discounts.

Decentralized perpetual swap exchanges, represented by GMX and dYdX, are still relatively underdeveloped compared to their CEX counterparts and have a lot of room for growth and adoption. Perpetual swaps are another example of a low-latency application that benefits from Solana’s fast execution and low transaction costs, although Jupiter will face competition from established players in the Solana Perps space, such as Drift Protocol, 01 Exchange, Zeta Markets, Mango, and others.

Making the pie bigger: Jupiter's vision

When the pie gets bigger, everyone gets more of it.

As an important part of the Solana ecosystem, Jupiter benefits by helping as many new users and developers join the ecosystem as possible. In addition to providing value through outstanding products, Jupiter aims to empower itsCommunityAnd the broader Solana ecosystem strength:

• $JUP: Governance Token for the New DAO (more on this below)

• Jupiter Start: For an ecosystem seeking sustainable growth, it is imperative to strike a balance between being open to innovation while being objectively critical of poor application design and being wary of teams that try to exploit narratives and biases in the market.

Jupiter Start旨在成为JupiterCommunity和更广泛的Solana生态系统之间的平台，以“帮助审查、辩论、理解和突出显示伟大的新项目”。这包括 Jupiter launchpad，以帮助引导新项目，新代币的预上市交易可用性以及Atlas，这是一项新的公共种子融资计划，允许社区投资早期项目，以及各种以社区为中心的教育项目倡议。

If you understandJupiter StartInterested in more information, we recommend reading this blog post.

• Jupiter Labs: This is a collective effort between the Jupiter team, community, and DAO to develop innovative products and tools for Solana DeFi. Although these initiatives will start with Jupiter, they are ultimately designed to be independently launched and run on Solana. Jupiter users will receive priority access to early product testing and receive related incentives, a portion of which will be allocated to the JUP DAO.

The first product that has gone live is the perpetual contract exchange, which has been launched in the testing phase and has proposed sUSD, a stablecoin backed by SOL (similar to LUSD: ETH) that uses leveraged LST to generate returns.

More information about $JUP

Jupiter announced the $JUP token at a watershed moment for Solana, a strategic decision made after the protocol reached many key milestones, including a broad and active user base, several major platform upgrades and new products, a range of ecosystem projects, and of course, the belief in the future uptick in Solana activity.

The maximum supply of $JUP is 10 billion, and the token distribution is evenly distributed into 2 cold wallets - the team wallet and the community wallet. The team wallet will be used to allocate to the current team, treasury and provide liquidity, while the community wallet is used for airdrops and various early contributors.

Since day one, 15% – 17.5% of tokens are in circulation, 10% – 7.5% are in hot wallets, and 75% are in cold wallets.

There will be a retroactive airdrop to Jupiter's 955,000 early users (before the deadline of November 2, 2023), as well as an airdrop designed to attract new users and liquidity. The DAO will then vote on the token unlock data, and the tokens will be initially locked up, with the unlock date set by the DAO. JUP holders will be able to vote on various key aspects of the Jupiter protocol and the role of the token, including the timing of the initial liquidity provision, future emission arrangements, the project will be showcased on Jupiter Start, and more.

“The initial value of JUP will be a symbol of Jupiter and DeFi 2.0, just like the value of UNI was a symbol of Uniswap DeFi 1.0.”

Fundamental Investment Catalysts

Now that we have discussed the components of the Jupiter Protocol, we can now explain what we envision as the long-term investment opportunity.

Betting on Solana

Solana’s roadmap is ambitious and exciting, and we expect ecosystem activity to continue to grow in 2024, building on momentum from Q4 2023. We believe this for a number of reasons:

• More airdrops: Marginfi and some other DeFi teams ignited the Solana ecosystem with their points program earlier in the summer of 2023. The JTO airdrop exacerbated the already growing momentum on Solana, creating a wealth effect that made many jitoSOL holders happy, but also left many dissatisfied and looking for the next big opportunity. Starting with Jupiter ($JUP), others worth watching include Kamino, Marginfi, Drift, Tensor, and more.

• Firedancer: Jump Crypto’s highly anticipated validator client, dubbed “Solana 2.0” by Toly himself. Expected to be a long-term boon to Solana’s performance and throughput as the network scales and evolves, Firedancer marks a major milestone for Solana as it increases client diversity, thereby reducing the risk of single points of failure on the network. Applications will become faster with low latency, an attractive selling point for users and developers alike. With Firedancer likely to go live in 2024, we expect a lot of speculation and growing interest around this milestone.

• DePin: This iscryptocurrencySolana is a new area in the blockchain space that demonstrates how tokenized assets can be used to help decentralize real-world business models. Solana has successfully attracted many projects, including Helium and Hivemapper. The interest in DePin as an emerging area has in turn brought more positive attention to Solana as the network demonstrates its utility in serving more specific use cases.

• Payments: Solana Pay is now integrated with Shopify, which means merchants can accept Solana payments, meaning the average JTO airdrop recipient could buy over 2,000 cups of coffee with their earnings. While there are still hurdles to overcome to actually get shoppers to pay in Solana Pay, the partnership with the largest e-commerce platform is a great start. Additionally, earlier this year, Visa, one of the world’s largest payment networks, announced plans to use Solana for a stablecoin settlement pilot, a testBlockchainAn experiment in settlement rail capabilities with the goal of building new products for commerce and money mobility. Solana’s high throughput, fast finality, low transaction costs, and node availability are all positives for Visa, just as Visa’s brand can bring a lot of attention to Solana. If successful, we believe the stablecoin settlement pilot will mark a major milestone in the development of real-world crypto use cases, and Solana will benefit as the de facto network to achieve this.

The last one worth mentioning is the Saga phone. While Solana’s phone may not be very successful in its first year, considering the impact of mobile integration on social media and payment applications, promoting mobile-friendly crypto environments and applications may be an exciting development in the long run. Recently, the Solana phone airdropped BONK tokens to buyers, and the team recently announced version 2.0 of the phone, including cheaper prices (you can buy it for $450) and a recommended leaderboard to drive more user participation.

Solana’s Challenges

While we remain bullish on Solana’s long-term growth, we expect the Solana core team and developer community to address several key issues in the short and long term that we will be watching closely:

• Fee Market: While Solana now introduces priority fees, there is no native mechanism to determine a “market” priority fee to help effectively limit spammers (i.e. EIP-1559). As demand for block space on Solana has greatly increased, more and more users are experiencing transaction failures, which further demonstrates the need to upgrade the network’s current fee market structure. Proposed solutions involve dynamic account fees and multi-dimensional EIP-1559, where fees for each account that touches the exact same hotspot increase exponentially.

• EVM Competition: While we believe that in the long term SVM vs. EVM will not be a zero-sum game and different networks will specialize in their respective categories, today Solana is still competing with the EVM space for market share and users, which is a large gap to bridge ($140 million vs. $3 billion gap).

  • EIP-4844 aims to significantly reduce the cost of L2 (80-90%) and make it easier to use/deploy, which could consolidate the leadership of Arbitrum, Optimism, and Base. Similarly, Celestia provides more flexibility and lower costs for L2 developers, which may attract talent and users away from Solana.

  • The re-staking narrative is likely to be one of the biggest catalysts for Ethereum and could bring in a lot of capital inflows.SafetyRisks aside, investors seeking native yields on native L1 assets will seek opportunities for higher returns, which provides Ethereum stakers with an opportunity to stake again.

• Parallelized L1: Parallelized L1 chains (MoveVM, Sei, Monad) are rising in popularity, optimizing for speed and performance similar to Solana, but are still young and immature. Built by several team members with backgrounds in high-frequency trading, Monad aims to bring Solana-like performance to the EVM environment, theoretically combining the “best of both worlds” with transaction speeds of up to 10,000 transactions/second. However, these chains not only face the difficulty of overcoming Solana itself, but also have to compete with the Neon EVM, which enables Solana compatibility through the Ethereum native environment. Aave recently published a proposal on its governance forum to discuss whether to deploy its V3 protocol on the Neon mainnet. With all this in mind, we believe Solana’s resilience is its greatest strength and long-term catalyst, and it has shown an ability to overcome macro challenges (such as the collapse of FTX) or technical shortcomings (such as network outages).

Betting on Solana = Betting on Jupiter

“Our vision for the future is closely tied to the growth and prosperity of the Solana ecosystem,” Jupiter’s green paper reads. “We are driven by our belief that a thriving Solana ecosystem will bring collective benefits to all stakeholders. Simply put, when the pie gets bigger, everyone gets more of it.”

We believe Jupiter’s key role in the Solana DeFi space makes it a viable bet for both near-term and long-term adoption of the network. The argument is pretty simple. More users on Solana = more users on Jupiter. Solana’s initial boom lasted for about a year (2021), during which time protocols like Saber and Serum dominated the DEX space. Jupiter gained traction shortly after launch, with the goal of leveraging on-chain liquidity on DEXs, rather thanstealJupiter has been a major player in the space, gaining market share to offer a better user experience and better pricing. However, it wasn’t until the fall of the once-dominant Solana DEX Serum that Jupiter became the market leader it is today.

In 2023,Jupiter Always occupy Solana DEX The transaction volume is above 60%.

Analyzing Jupiter’s business model

Initially, Jupiter's core product was simply an exchange engine optimized for better pricing, with no additional fees charged to traders. As the project grew, and trading volume and traders continued to grow, the team launched several new products that now serve as an organic revenue stream for the protocol through fees. We believe that the JUP DAO will naturally seek to ensure that $JUP holders receive a percentage of the proceeds from these fees as well as future opportunities in Jupiter Start and Jupiter Labs.

• Limit Order: 30 BPS

• DCA: 10 BPS

  • This is a unique product and I think Jupiter could leverage it further by raising the fees (around 20 BPS).

• Perpetual Contract

  • Opening/closing a position: 10 BPS

  • Swap Fee: 0 – 200 BPS (varies based on pool weight)

  • Borrowing rate = 1 BPS/hour * token utilization %

  • JLP pool receives 70% of fees generated by Jupiter perps

• External Protocols

  • If a protocol integrates Jupiter’s framework into its own software and then charges its own fees, Jupiter will ensure they receive a portion of those fees as well.

What If

• Jupiter Start: We think it might be wise to leverage the Jupiter Start program (i.e. Launchpad and Atlas) to create additional income streams for Jupiter and $JUP holders.

  • Launchpad: Establish transaction flow for projects incubated or operated by Jupiter Launchpad, where a portion of project revenue goes to JUP DAO.

  • Atlas: Create an efficient model to collect revenue from realized gains from public seed funding programs and distribute it to participating holders and investors.

• Jupiter Labs – As perpetual contracts have already demonstrated, Jupiter Labs supports the development of protocols that can generate additional revenue for Jupiter.

  • Another proposal for sUSD is in the works

  • An interesting question to consider here is how these initiatives might one day be independently launched and operated, as outlined in the Jupiter documentation, and how doing so would impact specific revenue streams.

• Exchange Fees

• Jupiter’s exchange engine has always been the core product that Solana users have come to know and love. However, as fee dynamics on Solana continue to evolve, transactions will undoubtedly become more expensive as more smart contracts compete for less block space. Jupiter has positioned itself as allowing traders to pay a priority fee to get faster execution, and if this feature continues to be adopted from this point on, it would make sense to charge an additional fee for the service Jupiter provides (there is no native way to calculate a “base” priority fee).

Jupiter's Competition

Overall, we believe that Jupiter is uniquely positioned in its role as an aggregator, as there is currently no direct competition with any trading protocols on Solana. That said, as the Solana DEX ecosystem continues to grow and demand for low-latency trading applications grows, Jupiter will naturally face challenges keeping up with the latest innovations and developing projects. Ultimately, traders want better settlement and will act when that happens.

Additionally, Jupiter faces greater competition for its other products, such as perpetual contract trading, which would generally incentivize teams to recreate a DCA product or something similar.

• The DEX landscape on Solana is evolving and becoming more competitive. Outside of Solana, the competition is even more intense.

• Jupiter’s competitive advantage is in providing price settlement for users; if a protocol emerges that offers better pricing, users are more likely to go there.

  • Swapping remains the primary use case; swap engine performance is critical.

Niche products (Perps, Limit Orders, DCA) have stronger competition and competitors can offer lower fees.

Advice for Jupiter

• More transparency about fees and revenues, as well as dashboards of product performance data would be helpful for investors.

• JUP holders should be the main beneficiaries of Jupiter’s revenue streams (Limit Orders, DCA, Perps, Jupiter Start + Labs).

• Consider leveraging off-chain liquidity (i.e. CEX LP inventory) as well as on-chain liquidity routing models to provide users with better pricing. Similar to 1inch Fusion, Matcha by 0x, CoWSwap, etc.

  • This will apply to swaps, limit orders, and DCA.

• Ensures that $JUP holders receive a portion of the revenue generated by Jupiter Labs products and services.

  • Ensure that any team that Jupiter Starts either incubated through the startup platform or supported through public seed funding, allocates a portion of the fees to $JUP holders when implementing their protocol.

• Ensure that large-scale airdrop distributions do not dilute the quality of participants representing the JUP DAO.

Future Outlook

Given its unique position in the ecosystem, we believe Jupiter is a viable bet for Solana’s near- and long-term adoption.

As network activity on Solana continues to increase, we expect Jupiter to capture a significant amount of liquidity through its established ecosystem presence, diverse product suite, and sustainable revenue model, which should benefit $JUP holders in the long term.

当Larry Fink开始谈论金融资产的代币化，以及像Solana这样的L1区块链继续寻求产品市场契合度并探索新的实用性和创新时，想象Jupiter随着时间的推移可以容纳各种新的资产类别也并不是太遥远的事情。

The article comes from the Internet:Jupiter is about to launch its coin, and this article comprehensively analyzes its products and business model

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