Jack Kubinec

Solana’s march into mobile continued yesterday when the popular DeFi platform Jupiter released its mobile app.&nbsp;



Jupiter’s pseudonymous founder meow said on X that the team built and dropped many features while developing the app, but the final version sticks pretty closely to Jupiter’s hit feature, which is swaps. Interestingly, Jupiter doesn’t appear to be making money from fees on the app, so the initiative is purely a play at growing Jupiter’s distribution for now.&nbsp;



The app has just two tabs, one for making swaps and one for viewing your wallet balance. Jupiter partnered with MoonPay to offer fiat onramps, and I was able to fund a wallet with SOL via Apple Pay in under ten minutes. The process wasn’t completely seamless — I could only pay with my debit card rather than with a credit card, which I only learned by trial and error — but it felt smooth overall.&nbsp;



Once Moonpay is set up and you have a wallet connected, it takes four taps to buy more SOL, which is a pretty frictionless experience akin to something like Robinhood.&nbsp;



Candidly, it’s not the best-designed crypto app I’ve used. Even in the memecoin world, Moonshot has a sleeker UX with features like live price charts which Jupiter lacks.&nbsp;



“[C]urrent onboarding for the app is still 2/10 &#8211; we are no where near ready for mainstream adoption,” meow told me in a text.



But it seems like for now, Jupiter may be betting that users want the best prices above all else — and taking aim at Phantom in the process. Jupiter is a swap aggregator that algorithmically routes trades across multiple decentralized exchanges to achieve the best possible price for users. It also doesn’t charge fees on swaps, making the prices even better. As I’ve written before, even as Jupiter releases other popular DeFi features like perpetual swaps and a token launchpad, <a href="https://blockworks.co/news/lightspeed-newsletter-solana-top-swap-venue">swaps remain the moat</a> that make Jupiter a force in Solana DeFi.



Phantom — which has a lot of distribution by dint of being arguably the most popular Solana wallet — also offers swaps through a mobile wallet, but its swap prices are consistently worse than Jupiter’s. Jupiter’s fee-generating products aren’t currently live on the mobile app, meaning this is currently a pure play for distribution — and Phantom is the most likely target for disruption.



As the Solana Seeker <a href="https://blockworks.co/news/lightspeed-newsletter-solana-second-phone">gears up for release</a>, it’s becoming clearer that the Solana world thinks the crypto market of the future will be won and lost on mobile devices. With Jupiter’s launch, a pretty venerable competitor just entered that arena.



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Solana’s top swap venue Jupiter just released a mobile app

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No matter how crazy things get, Jupiter’s market share seems impenetrable for the time being.&nbsp;



Last week, the swap aggregator and Solana DeFi everything app had two of its programs closed by an unauthorized user who gained access to its private key used for program deployments.&nbsp;



User funds were safe, the engineer in charge of the programs <a href="https://x.com/defiracer/status/1835367370472452167">disclosed</a> on X, implying that he meant to make the program only upgradeable by multiple key signatures but didn’t get around to it in time. The programs have since been changed — they are now governed by a multisig that takes multiple keys to be opened. Having just one private key guarding programs with real users is a serious security mishap, and Jupiter is probably thanking its lucky stars that no funds were stolen.



But despite this, no one seemed to care much. One commenter chastised the Jupiter engineer for leaving the “keys in the ignition,” but otherwise, the oopsies was met with a collective shrug.&nbsp;



On one hand, you could point out how near misses happen all the time in DeFi, and the space moves far too quickly for the crypto world to take stock of seeming minutiae like this. But the non-incident also perhaps points to something that doesn’t get talked about as much: Jupiter’s seemingly-uncrossable moat in Solana DeFi.&nbsp;



Jupiter’s calling card is its swap function which algorithmically routes trades across various liquidity venues to execute swaps with the best possible prices for users. When I set up a test swap of PYUSD for JitoSOL, it first proposed to route the funds through Raydium then to Meteora and onto Orca before returning to my wallet. This product is widely-used in Solana DeFi, and it tends to outperform competitors. While writing this article, I set up a quick few different swaps on Jupiter and Phantom, and Jupiter gave me a better price every time.



Because of this product, Jupiter finds itself somewhat immune to controversy — for now. Around a month ago, Jupiter founder meow penned a mea culpa <a href="https://discord.com/channels/897540204506775583/903114583126974494/1271507281586159778">apologizing</a> for poor user experience with things like gas fee estimation, adding that the Jupiter felt “quite hurt” that their products weren’t performing as intended.



But despite it all, there seems to be little negative impact on Jupiter. Its native token has traded essentially in tandem with SOL over the past few months. The platform has risen to become the third-largest in Solana DeFi by TVL, and it’s seen the most inflows over the past week of any Solana protocol with over $50 million — despite two of its programs being compromised.



Unless a better competitor emerges, Jupiter just seems to have a pretty good thing going on at the moment (though for what it’s worth, I <a href="https://blockworks.co/news/lightspeed-newsletter-pump-dot-fun-memecoin">made a similar case for pump.fun</a>, which may finally be running out of steam). 



In the meantime, Jupiter is building out a host of other features as part of its utopian “<a href="https://blockworks.co/news/lightspeed-newsletter-jupiter-unified-markets-plan">grand unified marketplace</a>” vision. There’s a lot of benefit to having one killer product prop up other lines of business. Amazon famously used its web services to bankroll its online marketplace for many years.



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Solana’s top swap venue seems immune to criticism

Jeff Albus

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Howdy!



Since it’s national poking fun at the British week: It’s a Chewsday, innit!



And speaking of chewing, a bit more on those pesky sandwiches:



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<h2 class="wp-block-heading">Solana’s sandwich attackers are hanging around</h2>



In early June, the Solana Foundation <a href="https://blockworks.co/news/lightspeed-newsletter-sandwich-attacks">blocked a group of validators</a> found to be participating in private mempools that facilitate “sandwich attacks” from receiving a delegation from the foundation’s stake.



The Solana Foundation is a non-profit entity developing the Solana network. It has a sizable stake of solana tokens that it delegates with the goal of diversifying the field of Solana validators. Validators who help facilitate sandwich attacking — or front-running user transactions to manipulate prices and pocket the difference — shouldn’t be recipients of what are essentially grants from the Solana Foundation, the thinking went.



The foundation’s announcement came with a groundswell of anti-sandwich activity: Jito’s DAO proposed to blacklist malicious validators, and Stakewiz began labeling known sandwich attackers, to name a couple examples.



More recently, the popular Solana NFT marketplace Magic Eden introduced “mempool protection” that keeps user buys from being replaced.



But nearly a month later, <a href="https://blockworks.co/tag/solana">Solana</a>’s sandwich attack woes don’t seem to have abated. A <a href="https://sandwiched.me/">dashboard</a> crafted by the data outfit GhostGraph shows these sorts of attacks happening every couple seconds, and the Discord channel where Solana’s validators talk shop is still cloudy on the path forward.



A couple things appear evident from GhostGraph’s dashboard: First, the several sandwich attacks being tracked per minute are memecoin swaps, meaning unsophisticated retail traders are being exploited by more savvy sandwichers. Second, these transactions are being processed through reputable block leaders, which are the validators who create given blocks.&nbsp;



That’s not to say these leaders are bad actors: They may just not realize their block includes sandwich transactions, as a developer <a href="https://discord.com/channels/428295358100013066/689412830075551748/1253413131472994338">pointed</a> out on Discord.&nbsp;



It’s also clear that the Solana Foundation’s un-delegation of stake wasn’t a silver bullet. Practically speaking, it’s difficult to slice out sandwich attackers — and to even find the private mempools where many of them reside.



I’ve heard of some in Solana running transactions with high slippage settings to purposely get sandwiched and identify attackers, but as Jito Labs CEO Lucas Bruder said in Discord, finding and blocking sandwichers is still a “cat and mouse game.”



When I asked the foundation’s ecosystem engineering lead Jon Wong about the difficulty of rooting out all sandwichers, he said “even if this is only an 80% type effort, I think it may be enough to at least dissuade everyone except the most dedicated attackers.”



These dedicated attackers can be quite dedicated though: A MarginFi researcher <a href="https://x.com/HypoNyms/status/1802100776346763406">documented</a> a sandwich bot named “arsc” pocketing $30 million over a couple months via sandwich attacks.



— Jack Kubinec



<h2 class="wp-block-heading">Zero In</h2>



<h3 class="wp-block-heading">$79.55 million</h3>



That’s the market <a href="https://defillama.com/stablecoins/Solana">capitalization</a> of PYUSD on Solana, making PayPal’s stablecoin the third-largest on the network, according to DeFiLlama. PYUSD is the eleventh-largest stablecoin <a href="https://www.coingecko.com/en/categories/stablecoins">generally</a>, per CoinGecko.



In late May, <a href="https://blockworks.co/tag/paypal">PayPal</a> deployed its <a href="https://blockworks.co/tag/stablecoins">stablecoin</a> on Solana to much fanfare but little immediate adoption — the coin had 56 holders two days after launching, we <a href="https://blockworks.co/news/lightspeed-newsletter-paypal-solana-institutional-adoption">reported at the time</a>.



That number has <a href="https://solscan.io/token/2b1kV6DkPAnxd5ixfnxCpjxmKwqjjaYmCZfHsFu24GXo">grown</a> to 652 now, which is bigger but still smaller than the number of subscribers to this newsletter (eat your heart out, PayPal).



PYUSD launched on <a href="https://x.com/KaminoFinance/status/1807762629852643429">Kamino</a> and <a href="https://x.com/JupiterExchange/status/1807767504376471912">Jupiter</a> this week, which will perhaps further grow adoption numbers, though the token was pitched as being focused more on payments than on DeFi.



— Jack Kubinec



<h2 class="wp-block-heading">The Pulse</h2>



Jupiter Exchange, the Solana-based DEX aggregator, is <a href="https://x.com/JupiterExchange/status/1807792180112847237">contemplating</a> an overhaul of its Jupuary event — a yearly token airdrop and community rewards initiative. The first Jupuary, which took place <a href="https://blockworks.co/news/jupiter-airdrop-draws-criticism">in the leadup</a> to a Jan. 31 airdrop, <a href="https://x.com/weremeow/status/1746923653055586716">featured</a> substantial token emissions and community rewards, though some concerns have arisen over high emissions and inflated FDV.



Founder Meow recently <a href="https://x.com/weremeow/status/1807689721973477699">proposed</a> a 30% reduction in JUP token supply, team allocations, and Jupuary emissions to address these issues; the <a href="https://x.com/weremeow/status/1807689721973477699">goal</a> being to streamline the tokenomics of Jupiter&#8217;s core asset, JUP, and foster strong community alignment.



Community sentiment has been mixed, but <a href="https://x.com/web3sven/status/1807692898185441510">many</a> <a href="https://x.com/MummyNinj/status/1807718219769335955">see</a> <a href="https://x.com/scripted_whiz/status/1807693442744467834">the</a> <a href="https://x.com/aboladejohn_/status/1807665225455309057">changes</a> as essential for long-term growth. User @SuperSolana <a href="https://x.com/SuperSolana/status/1807718460308193363">stated</a>, &#8220;We need to be less selfish; the first Jupuary saved a lot of people and gave back to thousands who lost in the bear market.&#8221; While others shared strong opinions on how to reward community engagement, such as, &#8220;Platform usage as in swap volume should definitely be the most ‘rewarded’ activity.&#8221;



Not all feedback <a href="https://x.com/entwolken/status/1807840788749115754">has</a> <a href="https://x.com/matsuokaayane/status/1806862294846148861">been</a> <a href="https://x.com/david_boo11/status/1807677693191749861">positive</a>. User @Oo7Shubh <a href="https://x.com/Oo7Shubh/status/1807680385330868499">expressed</a> skepticism, noting, “If we get the chance to vote, then I will definitely choose NO. Because in terms of circulating supply this will create a huge impact and that&#8217;s what stopping people to buy or hold JUP.&#8221;



A more favorable sentiment was captured by community member @JohnVagabonder, who <a href="https://x.com/JohnVagabonder/status/1808028079496855984">added</a>, &#8220;It reminds me of Christmas, if you&#8217;ve been good all year and not on the naughty list Santa Meow will give you a present in January.&#8221; Others expressed deep trust and belief in the Jupiter team&#8217;s vision, with users like @dynatronix <a href="https://x.com/DynatroniX/status/1807957845130072513">signaling</a>, &#8220;I have such belief, such faith, such trust. Jupuary was the best event in crypto history as I see it. Catdets like myself will never forget it! And the pie will grow!&#8221;



— Jeffrey Albus



<h2 class="wp-block-heading">One Good DM</h2>



A message from Mert Mumtaz, CEO of Helius:


<div class="wp-block-image">
<figure class="aligncenter"><img decoding="async" src="https://lh7-us.googleusercontent.com/docsz/AD_4nXdJ-fRt6E8tyo4cbWotymnrm4I5HdstSNE4wIf9lf0MVUBIxboIpJY6klyH90RCeGC1dd1CCgFc39tBInVb6eb5ol5uD-Sw5dGwd7Rvd-7edmZurUyeXQbfb-N0ZysBnfzfTeEtxw6KJP7WDxd9pTbgpbSC?key=ObPorV4ad96Tq5itsfs8Ww" alt=""/></figure></div>


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Lightspeed Newsletter: Solana users are still getting frontrun

Bessie Liu

Less than 24 hours following Jupiter’s much-anticipated airdrop, some critics are raising concerns about how the JUP token was launched.



Earlier this week, the Jupiter team outlined a comprehensive strategy that went beyond a simple token giveaway.&nbsp;



They aimed to use JUP as a cornerstone for DeFi 2.0, focusing on expansive growth, ecosystem initiatives and a governance model that would evolve to incorporate significant community decision-making.&nbsp;



Read more: <a href="https://blockworks.co/news/solana-based-token-launch">Solana-based Jupiter to launch token on Jan. 31</a>



Its &#8220;50/50 Tokenomics,&#8221; token minting ritual and cold wallet release conditions <a href="https://www.jupresear.ch/t/jup-the-genesis-post/478">demonstrated</a> an approach to managing token supply, distribution and security, ensuring long-term project sustainability and community involvement.



However, potential misunderstandings about the project&#8217;s intentions have led some to believe that the Jupiter team&#8217;s actions post-<a href="https://blockworks.co/tag/airdrop">airdrop</a> resembled aspects of a public sale.



A key issue raised by observers centers around the <a href="https://blockworks.co/tag/jupiter">Jupiter</a> team&#8217;s method of offering JUP on the open market, which they say has doubled as a capital-raising strategy. According to critics, this detail was not clearly communicated to those participating, leading to discussions about the level of transparency and the degree to which buyers were making informed decisions.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Lmao we literally bought into an OpenMarket sale for <a href="https://twitter.com/hashtag/JUP?src=hash&amp;ref_src=twsrc%5Etfw">#JUP</a>. Basically open market = fund raising Only that rather than buy the seed round / round a/b/c/etc we bought when it feaking IPO-ed on the stock market literally lmao holy shit wtf bbq <a href="https://t.co/RnpdLh0hiR">pic.twitter.com/RnpdLh0hiR</a>&mdash; Lord Ashdrake (@Lord_Ashdrake) <a href="https://twitter.com/Lord_Ashdrake/status/1752894684031008957?ref_src=twsrc%5Etfw">February 1, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



An X user that goes by the pseudonym 0x_Hammer <a href="https://twitter.com/0x_hammer/status/1752905999881748912?s=46">noted</a> in a tweet that the Jupiter team had put in “moon protection” on the JUP token launch so that prices could not exceed 0.70 until the team secured $100 million.&nbsp;



“People [are] participating in a sale without even realizing it,” 0x_Hammer wrote.&nbsp;



To address these concerns, meow, the founder of Jupiter, <a href="https://twitter.com/weremeow/status/1752954292313686178?s=46&amp;t=yjAdM2ddX0KgGQimu7jcDQ">wrote</a> in an X post that the team would have received more funds had they opted for an over-the-counter (OTC) deal or a regular initial DEX offering (IDO).&nbsp;



The reason they had launched their token in the way they did was to ensure that airdrop recipients would be able to sell into a massive pool, while prospective buyers would have the assurance that there would be a big enough pool to absorb selling pressure from airdrops.



“We, as a team, take on the risk that we have zero certainty about how much we will actually end up with because the community and those who have buyer remorse get first dibs,” meow wrote.



A crypto user that goes by the pseudonym GraffirapNFT <a href="https://twitter.com/GraffirapNFT/status/1752916637487866096">accused</a> the team of using the ICO to <a href="https://twitter.com/GraffirapNFT/status/1752916637487866096">drive</a> fake demand.&nbsp;



This claim, though, had already been clarified by the Jupiter team in an elaborate document <a href="https://www.jupresear.ch/t/jup-the-genesis-post/478">describing</a> the tokenomics of its token. The document addresses the in-and outflows of JUP tokens, where they would be stored and who would hold the tokens.&nbsp;



Read More: <a href="https://blockworks.co/news/jupiter-airdrop-tokenomics">Understanding Jupiter’s tokenomics ahead of its first airdrop</a>



Meow does <a href="https://twitter.com/weremeow/status/1752935949280190642">admit,</a> however, that the team had made mistakes in choosing the price range in which the token was launched.&nbsp;



Blockworks research analyst Ren Yu Kong noted that much of the criticism around the Jupiter airdrop has been unwarranted.



“Fundamentally, Jupiter set a price and a valuation that they were willing to launch at, in this case, $4 &#8211; $7 billion FDV. It&#8217;s no different to investment bankers setting an IPO price, which a company is willing to sell shares at,” Kong said.



He added, “No one is forcing participants to buy if they don&#8217;t like the valuation in the launch pool. Granted, maybe one would have preferred more free market price discovery, but that&#8217;s easier said than done.”



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Jupiter airdrop draws criticism, but support remains strong

Transactions on the Solana blockchain have almost doubled minutes after the anticipated Jupiter airdrop.



According to the Solana explorer, transactions per second (TPS) on Solana went from roughly <a href="https://explorer.solana.com/">1,900 to over 3,000</a> minutes following the airdrop.&nbsp;



Average ping time — the time between the initiation and completion of a process — has almost tripled, from roughly 20,000 milliseconds to over 60,000 milliseconds.



<a href="https://blockworks.co/tag/jupiter">Jupiter</a> is one of the largest liquidity aggregators on <a href="https://blockworks.co/tag/solana">Solana</a>, rivaling Uniswap v3&nbsp; for trading volume.&nbsp;



According to Coingecko, Jupiter currently has a 24-hour trading volume of over <a href="https://www.coingecko.com/en/exchanges/decentralized">$688 million</a> while Uniswap v3 on Ethereum currently has a 24-hour trading volume of a little over <a href="https://www.coingecko.com/en/exchanges/decentralized">$790 million</a>.



This Genesis airdrop will allocate 1 billion JUP tokens to community members. Four future airdrops will occur on the same date over the next four years.



Read more: <a href="https://blockworks.co/news/jupiter-airdrop-tokenomics">Understanding Jupiter’s tokenomics ahead of its first airdrop</a>



The initial airdrop will be given to engaged users, and an estimated <a href="https://twitter.com/weremeow/status/1724855485507981454">955K</a> wallets who have interacted with Jupiter before Nov. 2 will be able to claim eligibility.



According to Meow, 200 million tokens will be evenly distributed between all wallets, and 700 million tokens will be allocated based on a 4-tiered score distribution, with the top 2 thousand users receiving over 100,000 tokens each. Community members on Discord, X and other developers will receive the remaining 100 million tokens.



At the time of writing, the <a href="https://blockworks.co/price/jup">JUP</a> token is currently trading at $0.689, with a market cap of $924 million.



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