General
Jupiter’s airdrop: A test of Solana’s performance and power
- Jupiter’s airdrop is now a fact! The Decentralized Exchange Jupiter, debuted its JUP token on Wednesday, January 31st, initiating a free token distribution event, commonly known as an airdrop, which caused a congestion surge on the Solana network. With 1.35 billion JUP tokens distributed at an initial value of $0.40 each, the airdrop was valued at a staggering $700 million.
- The airdrop conducted by Jupiter stands as one of the most substantial in history, granting early participants a total of over $680 million in JUP tokens. As a result of the token’s launch, the Solana-based decentralized exchange has risen to become the seventh-largest DEX by market capitalization.
- Solana also witnessed significant growth in active wallets and token-linked accounts, increasing by 479,000 and 566,000, respectively, within a single day, primarily on January 31, coinciding with JUP’s launch.
A striking aspect of the case is that the Jupiter event had an unforeseen side effect. JUP, associated with the inactive Ethereum project Jupiter, saw a remarkable surge in value, rising from an average of $0.005 to $0.026 as users mistakenly purchased it, assuming it was connected to the Solana-based project with the same name. This effect lasted for a few hours before the token returned to its previous value.
A Defi leader that beats volume records
- Despite ranking 13th in total value locked (TVL) among Solana’s DeFi protocols with $92 million, Jupiter emerged as the most utilized DeFi service on the network, commanding 80% of organic volume and becoming the DEX with the highest overall trading volume.
- Jupiter Exchange recorded volumes exceeding $480 million in 24 hours, with a considerable portion driven by traders swapping stablecoins and trading the newly introduced memecoin, Wen. Over $50 million of Jupiter’s daily trading volume stemmed from transactions involving Wen, which was distributed to Solana users who had interacted with Jupiter in the past six months or owned the Solana Saga phone.
Remember: Our Aggregator DEXTSwap is available on Solana. You can buy and sell tokens in DEXTools with DEXTswap, in collaboration with Jupiter Exchange. Supported wallets are: Solflare Wallet, TrustWallet and Phantom. You can access here.
Uniswap already has a competitor: Jupiter
- Notably, Jupiter surpassed Ethereum-based Uniswap V2 and V3 volumes, with the combined trading volume of these protocols amounting to $470 million in 24 hours. Solana’s Jupiter decentralized exchange briefly surpassed Ethereum’s Uniswap in daily trading volume, signaling increasing interest in Solana’s blockchain ecosystem and its DeFi offerings.
- Operating on the Solana network, Jupiter has recently achieved a trading volume exceeding $517 million within a 24-hour period. In contrast, during the same timeframe, Uniswap’s V3 protocol recorded approximately $440 million in trading volume. It achieved this record trading volume following the launch of its native token and the eagerly anticipated airdrop event.
- Following Jupiter, the next three largest decentralized exchanges (DEXes) in terms of daily trading volume include Orca on Solana, the Uniswap V3 protocol on Arbitrum One, and Pancakeswap V3 on Binance Smart Chain.
- The rising prominence of Solana’s DEXes, including Jupiter, underscores the evolution of decentralized exchanges. Early challenges such as limited liquidity and user interface complexities have given way to more sophisticated platforms incorporating Automated Market Makers (AMMs) for enhanced liquidity and user experiences.
A historical precedent: the airdrop experience at Uniswap
- On September 17th, 2020, Uniswap distributed $UNI tokens to over 250,000 addresses that had previously engaged with the protocol. Eligible addresses were those that had interacted with the platform before September 1st, 2020, and were granted a minimum of 400 $UNI tokens each.
- This event was one of the highlights that kicked off the last crypto bull market.
- The distribution was notably skewed, with the vast majority of addresses, approximately 93.8%, receiving less than 412 $UNI tokens. Conversely, a small number of addresses, exceeding 250, received 250,000 $UNI tokens. These recipients were predominantly historical power users, large liquidity providers (LPs), and holders of $SOCKS tokens.
Conclusion: Airdrops and DeFi
- Looking forward, the emergence of third-generation DEXes aims to combine the best features of centralized exchanges with decentralization’s security and transparency benefits. This ongoing evolution offers investors new opportunities and reflects the dynamic nature of the cryptocurrency market.
- Over the past few years, the fascination with airdrops has captivated a significant portion of the cryptocurrency community. Airdrops represent essentially free funds, often in substantial amounts.
- However, the significance of Airdrops extends beyond mere monetary gain. Airdrops have been heralded as a groundbreaking marketing strategy in the realm of Web3, offering an innovative approach to generating excitement surrounding a project. They serve as an effective method to garner attention, promote adoption, and establish a foothold in a fiercely competitive market landscape.
