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Jupiter starts buying and locking JUP tokens
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- @airdropdecks
Jupiter is expected to buy more than $100 million worth of JUP tokens and lock them for at least three years, in order to keep the token's price and secure the interests of holders.
Jupiter Exchange began the process of accumulating USDC to implement the JUP buyback program, with a plan to allocate 50% of the protocol fee to repurchase and lock tokens within three years. The actual purchase will take place after the project consults the community on the optimal implementation.
Jupiter expects to acquire more than $100 million worth of JUP tokens per year, creating a steady supply of demand for the tokens.
In addition, Jupiter will host a JUMP Rally event this weekend to provide more details on buybacks and voting related to Meow's 2030 roadmap.
To ensure transparency, Jupiter will launch a dashboard next week to track its acquisition activities. This is an important step in a long-term strategy to reduce the supply of tokens in the market, increase the value of the ecosystem and ensure benefits for investors.
“Everything will be transparent, the dashboard will be available next week. This is a commitment to the community.”
The move follows the acquisition of JUP in January, when Jupiter spent 50 percent of the protocol fee to buy and burn tokens, sending the price of JUP up more than 60 percent higher. This is also consistent with the general trend of the crypto market, where platforms use buybacks as a supply management mechanism to drive sustainable growth.
One of the main drivers for the JUP acquisition came from the Perps platform's revenue, which generated about $2.35 million per week, or $330,000 per day. This means that more than $16,000 per day will be used to acquire JUP, not to mention profits from other Jupiter products such as APEJupiter and Photons, which have generated significant revenue.
Jupiter has also made numerous acquisitions of other projects in the Solana ecosystem to expand operations and optimize cash flow. The Moonshot acquisition helps integrate the platform's revenue into the JUMP buyback program, while the Sonarwatch acquisition supports the development of portfolio management product portfolio.jup.ag, another potential revenue source.
Currently, decentralized finance (DeFi) protocols are under increasing pressure to share protocol revenue with investors, leading to the introduction of value accumulation mechanisms for tokens.
The trend also received a boost from Donald Trump's victory in the US presidential election on November 5, making the legal environment more friendly to DeFi protocols. As reported by Grayscale, this could open up strong growth opportunities for DeFi.
On November 15, stablecoin platform Ethena agreed to share some $200 million in protocol revenue with token holders. Meanwhile, in December, the liquid restaking platform Ether.fi proposed allocating 5% of its revenue to the acquisition and distribution of ETHFI tokens to stakeholders.
Following this trend, in January, Maple Finance also announced that it was considering using protocol revenue to acquire SYRUP tokens and distribute them as rewards for stakeholder.
Jupiter is adopting the same strategy to maintain the JUP value, consolidating its position in the Solana ecosystem and DeFi in general.
