Jupiter airdrop: All you need to know about the token launch
After months of preparation, the liquidity aggregator that handles the majority of Solana's decentralized trading volume, Jupiter, is ready to launch its JUP token and launch its airdrop today, January 31. million eligible Solana wallets and the token launch will likely be the largest in 2024.
Are you ready? Jupiter has launched an airdrop testing tool and provides plenty of guidance on what to expect. Here is everything you need to know about the upcoming JUP airdrop.
When to claim JUP?
Jupiter will claim the airdrop at 10:00 ET on January 31 via its own launchpad. This Launchpad was just used to launch memecoin WEN on Solana.
Who gets JUP?
According to Jupiter, approximately 955,000 wallets are eligible to participate in the JUP airdrop, including early adopters who interacted with the protocol before the November 2, 2023 snapshot.
As mentioned, Jupiter has launched a tool to check if you are eligible to participate in the airdrop and if so, how many tokens you will receive. In an earlier tweet, Jupiter said 20% of the initial airdrop tokens will be distributed equally across all wallets, while another 70% will be distributed among users based on “score distribution.” depends on the level of protocol usage. The final 10% will go to community members and developers.
Further airdrops are planned in the future for new users, although there is no exact timeline yet on when those drops are expected or how profitable they will be for users. more recently.
How many tokens?
Overall, there are 10 billion JUP tokens being minted. Half of those tokens will be released to the community through various airdrops and other initiatives.
Ultimately, 4 billion JUP will be distributed through four airdrops, with 1 billion JUP set for initial token claims on Wednesday. Another JUP 1 billion will eventually be distributed to community contributors and grants, although the timing of those initiatives is yet to be determined.
Half of the total JUP supply will be used for token and team needs, including the liquidity pool. Team Jupiter will not earn any tokens until January 2025, when the two-year vesting cycle begins.
According to a post on Tuesday, a total of 1.35 billion JUP will be in circulation from day one, with 1 billion JUP for airdrop claims, 250 million JUP for a launch pool, and 50 million JUP for each “loan.” from centrally traded market makers” and “any immediate liquidity needs”. This is down from the initial JUP 1.7 billion planned for immediate circulation stated earlier.
Jupiter's achievements
Jupiter launched in October 2021, advertising itself as Solana's first onchain swap aggregator. An aggregator routes DeFi transactions in such a way that transactions have minimal slippage and execute faster, based on liquidity from multiple DEXs.
The aggregator is free to operate, but Jupiter charges fees for charge averaging (DCA) orders, perpetual swaps, and limit orders on its exchange.
According to data from Dune Analytics, Jupiter processes about 65% of Solana DEX volume. The aggregator peaked at $16 billion in volume in December 2023, up from $3.9 billion in November.
Source: station.jup.ag
The exchange saw a 24-hour trading volume of $529, according to Jupiter Aggregator. This trading volume surpasses Uniswap v2, which had a 24-hour trading volume of 119 million USD. This is still lower than Uniswap v3, which had a 24-hour trading volume of $852 million at the time of writing.
The platform's leap corresponds to Solana's notable price increase. A late-year surge helped Solana increase its value tenfold by 2023, although it is still less than half of its all-time high. Token airdrops from liquidity staking platform Jito and oracle provider Pyth have injected hundreds of millions of dollars into Solana's ecosystem. Solana DeFi protocols have set record volumes along the way.
Jupiter teased its JUP token at Solana's Breakpoint conference in November, saying the tokens would be distributed to the community through four airdrop rounds (as noted above).
The token aims to govern the future Jupiter DAO, which anonymous co-founder Meow said will be “the most efficient, forward-looking, decentralized, non-internal voting DAO in the history of DAOs.”
As is often the case with airdrops, JUP is being distributed based on a user's previous engagement with the platform — activities such as trading volume and actions on the site.
Notably, the token will not receive a revenue share until Jupiter sees a 10x increase in users, which is estimated to take two years. These are the types of growth expectations that were set at the launch of the token.
“Like BONK, JUP will attract new coins into our ecosystem,” wrote X user gaius1337.
Tokenomics analysis of Jupiter
DeFi projects are often challenged by issues such as liquidity fragmentation and uneven token distribution. Sometimes this leads to trading inefficiencies and concerns about centralization.
Jupiter solves these problems by pooling liquidity from multiple DEXs in an effort to improve trading rates and reduce slippage for users. This approach is somewhat similar to that of 1inch, a famous liquidity aggregator that consolidates liquidity to optimize trading.
Of JUP's total circulating supply of 10 billion, the Jupiter team will manage 50% of the supply and the remaining 50% will be distributed to the community. Unlike the initial statement in Jupiter's green paper, there will be no token sale activity.
Mert Mumtaz, CEO of Helius Labs, sees the move positively.
“Crazy VC sales have irreparably scarred Solana DeFi 1.0 – Solana DeFi 2.0 is changing that decisively.”
Detailed tokenomics analysis
Of the 50% JUP tokens distributed to the Jupiter team, only 20% of the tokens will be given to current team members. This 20% will not start vesting until after two years, which means that to receive JUP, current team members must be associated with Jupiter for at least that period of time.
Another 20% of JUP tokens will be put into the strategic reserve fund. This reserve will be used for future team members, future strategic investors and previous Mercurial stakeholders, meow wrote on X.
These tokens, equivalent to 4 billion JUP tokens, will be held in the 4/7 Team Cold Multisig wallet. This means that to make any change, a majority of four of the seven signature holders must reach unanimous consensus.
Meow notes that these tokens will be locked for at least a year and that the community must provide a minimum of six months notice before any possible liquidity event.
The remaining 10% of JUP tokens will be used as a liquidity source and transferred to the Team Hot Multisig wallet.
On the community side, 4 billion JUP will be distributed through four separate airdrops, taking place on January 31 every year.
The initial airdrop will distribute 1 billion tokens and the remaining 3 billion tokens will be held in community cold wallets managed by 4/7 multisig.
The remaining 1 billion JUP tokens will be made available to community contributors through grants. These tokens will be held in the community's 4/7 multi-signature hot wallet and Jupiter DAO will be responsible for determining where the funds will be allocated.
For the Genesis launch, there will be an initial maximum circulating supply of 1.35 billion instead of 1.7 billion as originally announced – this initial maximum circulating supply includes tokens from both sides. community and team side.
These 1 billion tokens will be distributed to community members in an airdrop scheduled for today. 250 million tokens will be allocated to the launch pool, 50 million JUP will be allocated for loans to centralized exchange market makers, and an additional 50 million tokens will cover all vendor needs provide immediate liquidity.
JUP token allocation. Source: Jupiter
Mumtaz said he believes this latest Jupiter airdrop is truly fair.
“They have clearly thought about it and worked with data providers to cover every angle – these things are largely subjective but I don't see any wrongdoing here.”
Jupiter's tokenomics analysis is quite similar to Uniswap's UNI token. Both the Uniswap team and the Jupiter team are allocated approximately 20% of the token supply. However, the slight difference is that in the case of the UNI token at Genesis, more than 60% of UNI was given to its community, with investors and advisors receiving less than 20%.
It is important to note that the JUP token is not designed to be utility-focused. Meow advised in an AMA on Reddit that users should not participate in JUP with the expectation that it will have many benefits.
“I find the idea that token utility drives value to be a myth created to justify why things have value or by project founders trying to explain why tokens Theirs is valuable. And I believe most people could care less about utility and more about value,” meow wrote.
In the first phase, JUP will be designed to manage the upcoming DAO and its purpose is to coordinate and promote growth and attract more users to the Solana blockchain.
“Over time, we will certainly want to enable JUP holders to be able to do more with their tokens, including participating in key ecosystem initiatives etc., but this That cannot be confused with why JUP is valuable,” he wrote.
