Slides presented at breakpoint 2023 can be viewed here
Growing the Pie
In this paper, we share an overview of what Jupiter has built in the past year, our ethos and our strategic direction for the future. This paper serves a consultative purpose. We want to invite you to engage in dialogue with us, and contribute to shaping the future of Jupiter and its role within the Solana ecosystem.
We will be also introducing for the first time $JUP, Jupiter Start and Jupiter Labs. We hope that the details in here will serve as a catalyst for fruitful discussions.
Today, Jup.ag is the default destination for traders on Solana. We have the best aggregator in crypto and the most seamlessly integrated platform in Solana – powering a variety of trading activities, including but not limited to swaps, limit orders, dollar cost averaging strategies and more ...
2023: Building the Best Decentralised Trading Experience
In the depths of the bear market in November 2022, we decided to double down on Solana. The collapse of FTX underscored the urgent need for a trustless alternative to centralised exchanges (CEX). And we believe that Solana, with its high-performance capabilities and robust community, is the best blockchain for this endeavour.
Our commitment was met with prolific shipping throughout 2023, as we successfully launched an array of new routes, innovative products, and better developer infrastructure. For example:
- Our routing improvements include the launch of Metis – a novel routing algorithm that was customised for Solana’s fast blocktimes. We also launched instant staked SOL to SOL swaps that gives you the best price across all trade sizes.
- Our product portfolio expanded to include Dollar Cost Averaging(DCA), Limit Orders and a Bridge Comparator.
- Our developer tooling improved with 2 major API Upgrades, Jup for Payments & Games, and the Jupiter Terminal.
A full list of our products and product announcements can be found on our documentation website and blog.
By the end of October 2023, we facilitated a cumulative trading volume of $35 billion, executed 102 million transactions, and were used by 955,000 unique wallets, solidifying our position as the most used trading platform. We account for the majority of retail flow, with approximately 80% of organic swap volume originating from Jupiter.
Feedback from our user community has been overwhelmingly positive, with many highlighting that the superior pricing and exceptional user experience provided by Jupiter were surpassing those offered by traditional centralised exchanges.
Core Anchors for Excellence in Product Development & Ecosystem Enhancement
The progress and innovations at Jupiter can be attributed to three core anchors that guide every decision and strategy we undertake:
The JUP Promise: Best Price, Best Token Selection, Best UX: This deceivingly simple and straightforward promise is the driving force behind our obsessive efforts in product innovation. From enhancements in routing algorithms to the integration of new tools, they are all aimed at delivering an exceptional trading experience for both users and developers.
Maximising the Potential of Solana’s Technical Capabilities: Much like harnessing the full potential of a high-performance vehicle, we strive to make the most of Solana’s capacity for providing swift and efficient trading experiences. Jupiter has been at the forefront of adopting new Solana features such as lookup tables, priority fees, and token 2022 standards.
Improving the liquidity landscape in Solana: We are committed to the rapid integration of new liquidity sources and innovative use cases, ensuring the continual growth and competitive edge of the Solana ecosystem.
These anchors have been instrumental in the development and launch of various products at Jupiter. A prime example is Metis, our advanced routing algorithm, which is a heavily customised version of the Bellman-Ford algorithm designed to provide optimal price routing in Solana’s fast block-times.
It guided us to prioritise the integration of Sanctum, facilitating instant staked SOL to SOL conversions at the most favorable rates, irrespective of the trade size. This helps to accelerate the adoption of liquid staking tokens (LSTs) within the ecosystem, and paves the way for new composable innovations.
Furthermore, we introduced the bridge comparator, a tool that allows users to seamlessly compare and select the most efficient bridge for transferring tokens from other chains to Solana, so that we can help to bring more capital to Solana.
Most recently, during the Jupiter Planetary Developer Week, we unveiled a plethora of new features, including the V6 Swap API, Jup for Payments, and the upgraded Jupiter Terminal V2.
Having provided an insight into our recent product developments, you might now be curious about our future plans and directions.
Help Solana Grow aka Grow the Pie!
Our vision for the future is intrinsically tied to the growth and prosperity of the Solana ecosystem. We are driven by the conviction that a flourishing Solana ecosystem translates to collective benefits for all stakeholders involved. In simple terms, when the pie grows, everyone gets more pie.
In alignment with this vision, we are excited to introduce The Jupiter Plan, a strategic framework encompassing three pivotal components:
$JUP Governance Token: Our goal is to cultivate a robust community and DAO for Jupiter. We also aim to incentivize engagement and new capital flows into the Solana ecosystem, thereby fostering its growth and vibrancy. NOTE: $JUP is not live yet, please beware of fake tokens.
Jupiter Start: This is a year-long initiative designed to help great new projects win on Solana, with a focus on projects that contribute to the health of the Solana ecosystem, not short term pump and dumps. There will also be a commitment to transparency and public seeding, so that the community can invest in good projects early on without gatekeeping.
Jupiter Labs: In collaboration with our community and the JUP DAO, we will launch cutting-edge decentralised finance (DeFi) projects specifically tailored for the Solana ecosystem. We have 2 new initiatives to introduce – a novel LP-to-trader perpetual exchange, and a xSOL leveraged stablecoin.
$JUP: Unveiling our Governance Token
NOTE: $JUP is not live yet, please beware of fake tokens.
We are thrilled to formally announce the impending launch of the $JUP token, a milestone that our community has been keenly anticipating. Our approach to introducing the JUP token has been deliberate, and we believe that the conditions are now optimal for its launch, as several key pieces are falling into place:
- Having a broad and engaged user base
- Completion of major platform upgrades
- Having a pipeline of ecosystem projects
- Strong belief in the coming upswing of Solana
The primary objectives of launching the JUP token are to:
- Energise the ecosystem by attracting new capital flows and users to Solana. We aim to attract new investments, users, and capital to Solana, contributing to its overall growth and vitality.
- Generate momentum for new ecosystem tokens: The JUP token can help to catalyse the momentum for more new ecosystem tokens.
- Build a Strong and Distributed JUP Community: We are focused on establishing a robust and broad community that is engaged and committed to supporting crucial initiatives in the long term.
JUP will be a Governance token. Initially, the token will be locked, and the DAO will decide the exact unlock date. JUP token holders will have the ability to vote on critical aspects of the token itself, such as the timing of initial liquidity provision, future emissions beyond the initial mint, and key ecosystem initiatives, including determining the projects that will be a part of Jupiter Start.
For the initial supply of tokens, the proposed allocation will be as follows:
- 40% Community Growth (4 rounds of airdrop distribution)
- 20% Locked Token Sale
- 40% Team & strategic reserve (vested)
There will be 3 parts to the launch phases; the Community Airdrop, the Growth Airdrop and the Locked Token Sale.
Initiating a 2 week consultation period for airdrop mechanics
Traditionally, the mechanics of airdrops are unilaterally determined by the team, with the community subsequently informed of the decision. This often leaves limited scope for discourse or community input.
In our quest to foster a more collaborative ecosystem, we are opting for an alternative approach, where the community plays an integral role in shaping the mechanics of the upcoming airdrop. This green paper does not lay out the specifics of the airdrop criteria. Instead, starting from today, we are initiating a two-week consultation period, during which we invite open dialogue and contributions from all community members.
We want to devise a plan that resonates with the values of the community, so that we can own this journey together and be proud shared owners of JUP.
Community Airdrop
For the first round of community distribution, we propose an airdrop for existing users and community members to reinvigorate the community and give everyone a stake in the JUP and Solana. Given that 955,000 users have used Jupiter before, this will be one of crypto's biggest organic airdrops. As it has been a very challenging (and often painful) year, we suggest prioritising users who have been consistently part of Jupiter and Solana throughout the whole time, especially the most bearish times.
Growth Airdrop
In the Growth Airdrop phase, we will see the formation of the DAO that will help decide on the Token Launch. In addition, the second round of our community distribution has a growth-centric focus, with the primary objective of attracting new users and enhancing liquidity within the Solana ecosystem.
We will reward trading on Jupiter and Solana to incentivise users to trade more actively. Moreover, we are anticipating the emergence of a new wave of promising ecosystem tokens early next year, and we want to drive as much focus and attention to these tokens as possible. It is crucial that users who are incentivised to start trading on Solana again can appreciate the significant strides made by Solana in terms of ux and ecosystem growth. We look forward to experimenting with the community and ecosystem on this!
Locked Token Sale Phase
To reinvigorate the public sale market of Solana, we are initiating a Locked Token Sale (LTS) phase for 20% of tokens. In order to make it as egalitarian as possible, there will be no exclusivity in terms of whitelisting nor early access, providing an equitable opportunity for all.
Tokens acquired in this sale will be locked, but they will confer voting rights upon the holders. This includes the ability to vote on pivotal decisions such as determining the initial liquidity date of the token. Consequently, participants in the token sale will effectively become the inaugural members of the DAO, playing an integral role in shaping its direction.
Over the public LTS and 2 rounds of community distribution, our objective is to cultivate a DAO that is not only highly engaged but also eagerly invested in the success and prosperity of Solana.
This approach represents a deliberate shift away from prevailing narratives of retail investors being disadvantaged, insider dominance, high FDV & low float token launch games, and uncertainties surrounding token emissions in Solana. Instead, we are championing a model of transparency and equitable participation – our airdrops and token sales have no insiders and no centralised voting, a high float from the start, and diverse investors that include previous users and new users.
By granting the DAO the authority to determine subsequent community distributions and sanction future mints, we cement a system that guarantees full transparency of emissions. The role of the DAO will also be growth centric, collaborating not just on the current initiatives but also to grow new world class products in the future.
There is a very clear distribution of roles between the team and the DAO - The team manages products, protocols, and development, while the DAO manages one of the most crucial aspects - token distribution & future emissions.
The entire initial supply belongs to community participants through the token sale, airdrops, and growth incentives, while the team’s allocation will be vested over 2 years. The strategic allocation (for potential future investors and talent) can only be used by the team at least a year after token liquidity, and there will be at least 6 months notice before any tokens are released from this pool.
Our aim is to energise the Solana ecosystem by driving investment, users and capital to Solana, generate more momentum for new ecosystem tokens and build up a strong and focused Jupiter community to help improve Solana.
Together, we work towards a future where the victories of Solana translate to victories for all. Solana wins, everybody wins!
Jupiter Start
Jupiter Start is a year-long initiative that seeks to redefine the launchpad experience, placing a strong emphasis on the long-term success and sustainability of new projects within the Solana ecosystem. We believe that for a project to truly thrive, it requires more than just a successful token launch; it needs a robust community, ongoing momentum, and strong visibility from investors.
New projects are essential for invigorating new ecosystems, and this underscores the significance of launchpads. However, the current landscape of existing launchpads leaves much to be desired. Their predominant focus tends to be on short-term token price gains, often neglecting the long-term viability and sustainability of projects. This short-term approach is further compounded by the absence of an engaged and supportive community, which is integral for the flourishing of any project.
Most fundamentally, launchpads today seem more focused on pumping the value of their own platform token rather than genuinely supporting new projects and the crypto ecosystem, with unfair advantages given to insiders and the encouragement of FOMO and speculative behaviour that leads to tokens dumping quickly post-launch.
The crypto industry is at a point where the need for real-world use cases, trustworthiness, and long-term sustainable projects has become more apparent than ever. There is a strong desire among community members and investors to contribute to projects that show promise and innovation. After all, the beauty of crypto is the ability of anyone to be involved in the entire value creation as early as possible. At the same time, new and legitimate teams are in need of support in terms of users, community engagement, and financing to build momentum and bring their visions to life.
Also, crypto needs a lot more use cases and trust worthiness. Two of the most prominent criticisms of crypto have been that there are no real use cases for real world adoption and that the prevalence of scams and rugs erode trust among retail investors.
With one of the most highest level of active developer participation, technical platform suitable for mainstream adoption, and invaluable experience from the dangers of short-termism, we believe that Solana is the perfect place to usher in a new era for crypto - focused on new use cases and long term thinking that is so very much needed.
Jupiter Start will be made up of 3 core components, which will be incrementally launched over the next few months.
Jupiter Token Spark: This initiative is committed to demystifying new tokens, simplifying the complexities associated with token launch, and ensuring immediate tradability on Jupiter. We highlight exceptional projects, providing them with visibility within our community and DAO.
Jupiter Launchpad: We aim to address the current inadequacies of launchpad models, concentrating on fostering long-term alignment, nurturing an organic community, maintaining ecosystem health, and integrating delegation features.
Jupiter Public Seeding: Our initiative supports communities in investing in new projects through a public venture capital funding model. This enables communal participation in seeding teams from day one, while incorporating crucial mechanisms such as vested funding.
Jupiter is well positioned to do this for the following reasons:
- jup.ag is the go-to platform for the most active traders, making it an ideal place to showcase and introduce new projects.
- In conjunction with the launch of JUP, we are cultivating a broad and varied community, alongside a decentralised autonomous organisation (DAO). This network is poised to actively engage with and participate in new ventures.
- The JUP DAO can facilitate independent decision-making on project involvement, effectively mitigating potential conflicts of interest. Furthermore, our extensive collaborations across the entire ecosystem position us to significantly contribute to and encourage cooperative efforts.
The first component to be launched will be Jupiter Token Start, which will provide both a step by step guide to launching a token for immediate discovery and trading on Jupiter, as well as provide an avenue for the best projects to be discovered by the Jup.ag user base and JUP community, while offering potential investors and traders the chance to explore, interact and understand the new tokens.
These components set themselves apart from prior cryptocurrency initiatives with the following core values:
- 100% transparency of end to end processes
- Commitment to long term health of the Solana ecosystem
- Inclusive participation regardless of token ownership
- No insider advantage or preferential treatment
- Co-development with the broader ecosystem
- Clean, productive alignment of interests
- Support for genuine user and community building
We hope that Jupiter Start will illuminate Solana's significant advancements, showcasing it as a leader in progress, productivity, and ethical practices within the cryptocurrency ecosystem. And we want to work side by side with the projects, community and the broader ecosystem to achieve this!
Jupiter Labs
Jupiter Labs will debut top-tier DeFi protocols in partnership with Jupiter users, JUP DAO, and the Solana community. We aim to bolster Solana's DeFi ecosystem by nurturing new projects, leaders, and tokens. Although these initiatives will originate within Jupiter, they are ultimately designed to launch and operate independently.
Jupiter Labs is initiating two innovative projects which are at different stages of development:
LP <> Trader Perpetuals: This is a novel LP-to-trader perpetual exchange on Solana that offers up to 100x leverage. By utilising pool liquidity and oracles, it ensures zero price impact, zero slippage, and deep liquidity. Oracles enable stable market operations during liquidations and stop-loss events, removing risks of position bankruptcy and LP pool fund loss. Users can open and close positions in one simple step, eliminating the need for additional accounts or deposits. With Jupiter Swap integration, any Solana token can be used to open positions.
xSOL Leveraged Stablecoin: We propose sUSD, a new stablecoin backed by SOL and uses leveraged LSTs as the primary yield mechanism with protocol level dynamic rebalancing for stability. Borrowers can mint sUSD using SOL as collateral through interest-free loans with returns from the staked leveraged SOL covering the borrowing costs while providing annualised returns of 7~20% to sUSD holders. We suggest several mechanisms to further enhance the stability and utility of sUSD, including USDC-sUSD pool and various sUSD redemption mechanisms.
These projects will be bootstrapped in conjunction with Jupiter users, the JUP DAO and the Solana ecosystem. Jupiter users will be granted priority access to test and benefit from incentives associated with these protocols and the JUP DAO will receive part of the protocol tokens. Crucially, we would invite knowledgeable members of the Solana ecosystem to be part of the process of community and protocol development early on, with community tokens allocated for this purpose.
In Summary
Crypto is in dire need of more users, an expansion of use cases, and an enhancement of trust. Solana is the perfect place for all 3 - It can be the most used, most useful and most trusted ecosystem.
Jupiter can help:
- $JUP: Driving an increase in on-chain users and activity.
- Start: Broadening the spectrum of use cases and bolstering retail trust.
- Labs: Introducing innovative and impactful DeFi protocols.
Together, let's shape a future where we don’t need CEXes anymore, where crypto is useful, and where your mum is proud of you for working in crypto.
Woohoo, LFG!