SHILL Issue 145

JUP - The symbol of DeFi 2.0
The JUP token marks a significant milestone in Jupiter’s
development and ethos. Much like UNI, the governance
token of Uniswap, symbolized the first wave of DeFi on
Ethereum, JUP aspires to embody the essence of DeFi 2.0
on Solana.
Designed as a governance token, JUP will allow holders to
influence crucial aspects of the ecosystem. This includes
voting on the critical aspects of the token itself, such as
the timing of initial liquidity provision, future emissions
beyond the initial mint, and key ecosystem initiatives.
Source: Dune Analytics
Nonetheless, Jupiter remains dedicated to continuous
innovation, aiming to improve existing features and introduce
new products aligned with its three main business
model anchors:
• Delivering the best UX possible
• Maximizing the potential of Solana’s technical
capabilities
• Improving Solana’s liquidity landscape as a whole
Given its unique position, I believe that Jupiter is a bet on
two things:
1. Solana’s long-term adoption: 2023 was a year of
rebirth for Solana as network activity picked up. I
believe that it is well-positioned to continue growing
and take a larger share of the L1 market. This
could benefit Jupiter.
2. DeFi going mainstream: The future of trading
is on-chain, and even CEOs of large traditional
finance institutions, like Larry Fink, are beginning
to talk about the “tokenization of every financial
asset.” Hence, it doesn’t seem too far-fetched to
think that Jupiter could facilitate this transition.
Source: Jupiter exchange
The key objectives of the token are:
• Energizing the Solana ecosystem by attracting new
capital flows and users.
• Generating momentum for the launch of new ecosystem
tokens: JUP is poised to act as a catalyst for
the introduction of more ecosystem tokens.
• Build a Strong and Distributed JUP Community.
As outlined by the pseudonymous co-founder Meow, JUP
aspires to establish “the most effective, forward looking,
decentralized, non-insider voting DAO in [the] history of
DAOs.”
Furthermore, the utility of JUP will evolve over time depending
on the direction taken by the community. Potential
future utility for the token could include:
• Fee reduction on the perpetual exchange.
• Improved access and allocation to the launchpad.
• Fee sharing on the Automated Market Maker
(AMM).
However, Meow has made it clear they won’t be turning
on revenue sharing until they have 10x their user base at
least.
The recent announcement of the JUP token further exemplifies
Jupiter’s strategic step in that direction.
Tokenomics
Tokenomics reflect the ethos of a project and Jupiter vision
is to make it as simple as possible. With a max. supply of
10 billion JUP, the token distribution is equally split between
2 cold wallets - the team wallet, and the community
wallet. The team wallet will be used for allocations for the
current team, treasury, and liquidity provision, while the
community wallet is geared towards airdrops and various
early contributors.